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2018 (6) TMI 561 - AAR - VAT and Sales TaxClarification on the rate of Tax - Centrifugal Monoblock Pumpset, Submersible Pumpset - Held that - Entry 26 of Part-B of the First Schedule to the TNVAT Act, 2006 reads as under (a) Centrifugal and Monoblock submersible pumpsets for water handling and parts thereof - 5% (Commodity Code 2026); (b) Pumpsets of 3 HP and 5 HP - 5% (Commodity Code 2026). It is clarified that Centrifugal and Monoblock Submersible Pumpsets for water handling are taxable @ 5% as per Entry in SI.NO. 26(a) of Part-B of the First Schedule to the TNVAT Act, 2006 .
Issues: Clarification on the rate of tax for "Centrifugal Monoblock Pumpset, Submersible Pumpset" under the Tamil Nadu Value Added Tax Act, 2006.
Analysis: 1. The applicant, a registered dealer, sought clarification on the tax rate for pumpsets under Entry 26 of the TNVAT Act, 2006. 2. The applicant argued that all pumpsets, regardless of horsepower, should be taxed under Entry 26(a) as there is no specific horsepower mentioned. They also highlighted that Entry 26(b) does not differentiate between pumpsets based on type. 3. The Authority examined the relevant provisions of the TNVAT Act, 2006 and Rules, along with the classification of commodities under different schedules. 4. The specific entries in Part-B of the First Schedule were analyzed. Entry 26(a) covers "Centrifugal and Monoblock submersible pumpsets for water handling," while Entry 26(b) pertains to pumpsets of 3 HP and 5 HP. 5. Referring to a previous ruling in a different case, the Authority clarified that pumpsets of any horsepower fall under Entry 26(a) and are taxable at 4% or 5% based on the timeline specified. 6. Consequently, the Authority confirmed that "Centrifugal and Monoblock Submersible Pumpsets" for water handling are taxable at 5% under Entry 26(a) of the TNVAT Act, 2006. This detailed analysis of the judgment provides a comprehensive understanding of the issues raised and the Authority's clarification regarding the tax treatment of specific pumpsets under the TNVAT Act, 2006.
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