2018 (5) TMI 176 - HC - VAT and Sales Tax

Rate of tax - different types of steel bars/rods of different diameters have been used for reinforcement in the construction of the building - whether the lower rate of tax chargeable on sale of iron and steel is applicable or the higher rate at 12.5% leviable for iron and steel used in execution of works contract in the same form? - Held that - the apex court decision in the case of Smt. B. Narasamma Versus Deputy Commissioner Commercial Taxes Karnataka & Another 2016 (8) TMI 636 - SUPREME COURT referred, where it was held that the declared goods in question can only be taxed at the rate of 4% - petition dismissed.

Summary

Issues:
Challenging order of Karnataka Appellate Tribunal under Section 65(1) of Karnataka Value Added Tax Act, 2003; Condonation of delay in filing petitions; Interpretation of tax rates on different types of steel bars/rods used in construction.

Analysis:
The judgment by the Karnataka High Court, delivered by Justice B.S. Patil, pertains to revision petitions filed under Section 65(1) of the Karnataka Value Added Tax Act, 2003, challenging an order passed by the Karnataka Appellate Tribunal. The Tribunal had allowed the appeal filed by the assessee, setting aside the orders of both the Assessing Authority and the Appellate Authority. The matters were initially listed for orders on an application for condonation of delay. However, the Court decided to proceed with final disposal, citing alignment with the decision of the Apex Court, rendering notification of the respondent unnecessary.

The Tribunal's decision was based on previous judgments of the High Court, which interfered with the re-assessment order made by the Assessing Officer and affirmed by the Appellate Authority. The High Court Government Pleader submitted that the issue raised in the petitions aligns with a decision of the Apex Court in a specific case, highlighting the relevance of the factual matrix in determining the applicable tax rate for different steel products used in construction. The Court referred to the Apex Court's judgment in a similar case, emphasizing that a higher tax rate is not attracted in such circumstances, as clarified in paragraphs 18 and 19 of the Apex Court's decision.

In light of the legal principles established by the Apex Court, the High Court concluded that no substantial question of law necessitated consideration in the revision petitions. Consequently, the Court dismissed the petitions along with the application for condonation of delay. The judgment provides a detailed analysis of the legal precedents and factual similarities, ultimately leading to the dismissal of the petitions based on the established legal position by the Apex Court.