2016 (4) TMI 394 - HC - VAT and Sales Tax

Revision petition under Section 86 of the Rajasthan Sales Tax Act, 1994 - Liability of turn over tax - In respect of business transactions for the year 2000-2001 - Held that - the issue is squarely covered by the decision of this Court in the case of Assistant Commissioner, Special Circle, Udaipur Vs. M/s H.E.G. Limited, Rishav Textiles, Rishavdev, Udaipur, therefore, the revision petition is dismissed. - Decided against the revenue

Summary

Issues:
Challenge to Sales Tax Revision Petition under Section 86 of the Rajasthan Sales Tax Act, 1994 regarding turn over tax for the assessment year 2000-2001.

Analysis:
The High Court addressed the challenge to the Sales Tax Revision Petition filed by the Revenue against the order dated 28.10.2005 passed by the Rajasthan Tax Board. The case involved the liability of turn over tax for the assessment year 2000-2001, where a demand of Rs. 26,600/- was raised by the Assessing Authority. The assessee had filed appeals before the Deputy Commissioner (Appeals) which were allowed, leading to further appeals by the Revenue. Both parties agreed that the issue was covered by a previous court decision.

The Court referred to the case of Assistant Commissioner vs. M/s H.E.G. Limited, where the definitions of "turnover" and "taxable turnover" were crucial in determining the liability under the Rajasthan Sales Tax Act, 1994. The Court emphasized that the power to tax is limited by the Constitution of India and the Act itself, restricting taxation on transactions like interstate sales or export sales. The Court clarified that the power to exempt goods or transactions is based on the power to tax, and goods not taxable cannot be exempted. Therefore, the term "annual gross turnover" had to be interpreted in the context of taxable turnover, excluding components like branch transfers, export sales, and interstate sales.

Regarding the levy of concessional tax rate on diesel and the issue of packing material, the Court relied on previous decisions and concluded against the Revenue. The Court dismissed the revision petitions of the Revenue, directing the assessing authority to recompute the exemption fee and refund any excess collected from the assessee. The Court also dismissed the Revenue's claims on the concessional tax rate for diesel and left the issue of packing material open for the assessing authority to decide.

In conclusion, the High Court dismissed the revision petition filed by the Revenue, emphasizing the need to interpret terms like "annual gross turnover" in line with taxable turnover definitions and restricting taxation powers within the legal framework provided by the Constitution and relevant statutes.