9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2018 (11) TMI 1360 - HC - VAT and Sales TaxMining Services - C-Forms - concession for the HSD - whether quarrying can act as mining ? - benefits under Section 8 of the CST Act - whether the fuel it uses for its machinery and vehicles qualifies for that benefit? Held that - The Court analysed, among other things, Section 8 of the CST Act. It has held that the locomotives and motor-vehicles are used by the petitioner after the mining operations were concluded and before the manufacturing process commenced, and also to carry the finished products. The Company uses HSD oil as its fuel in its quarrying operations. With that fuel it runs its machinery and also its motor vehicles - In Indian Copper Corporation Ltd. 1964 (10) TMI 41 - SUPREME COURT OF INDIA , the Supreme Court has discussed thread bear the legislative nuances of Section 8, especially Section 8(3)(b), of the CST Act - Their Lordships have held that if a dealer is engaged both in mining operations and the manufacturing process-the two processes being interdependent-it would be impossible to exclude vehicles used for removing the mined (here'quarried') material from the place of operation to other places. Petition allowed - the respondents is directed to permit the petitioner Company to have access to the on-line facility- KVATIS- so it can download the necessary C-forms - petition disposed off.
Issues Involved:
1. Whether "quarrying" can be treated as an act of "mining" under Section 8 of the Central Sales Tax Act, 1956. 2. Whether the petitioner-Company is entitled to tax concession on High-Speed Diesel (HSD) used for machinery and motor vehicles in quarrying operations. Issue-wise Detailed Analysis: 1. Whether "quarrying" can be treated as an act of "mining" under Section 8 of the Central Sales Tax Act, 1956: The petitioner-Company, engaged in quarrying and crushing granite metals, sought tax concessions under Section 8 of the CST Act, which refers to "mining." The petitioner argued that quarrying should be considered as mining, citing various statutory definitions and judicial precedents. The Court examined the definitional dynamics of "mine" and "quarry" from various dictionaries and statutory provisions. According to the Dictionary of Mining, Mineral, & Related Terms, a "quarry" is an open or surface mineral working, usually for the extraction of building stone, and is distinguished from a mine. The Shorter Oxford English Dictionary defines "quarry" as an open-air excavation for extracting stone, while "mine" is an excavation for extracting minerals like metal, coal, etc. The Court referred to Section 2(j)(iv) of the Mines Act, 1952, which defines "mine" to include any excavation for obtaining minerals, including opencast workings. Section 3(d) of the Mines and Minerals (Development and Regulation) Act, 1957, defines "mining operations" as operations for winning any mineral, and Rule 2(xvi) of the Kerala Minor Minerals Concession Rules, 2015, defines "quarrying lease" as a mining lease for minor minerals. Judicial precedents, including D.K. Trivedi and Sons v. State of Gujarat, emphasized that quarrying minerals is a mining operation, as it involves winning particular classes of minerals. The Division Bench in All Kerala River Protection Council held that mining operations include quarrying. Thus, the Court concluded that "mining" in Section 8 of the CST Act encompasses quarrying, and the petitioner-Company's quarrying activities qualify as mining. 2. Whether the petitioner-Company is entitled to tax concession on High-Speed Diesel (HSD) used for machinery and motor vehicles in quarrying operations: The petitioner-Company argued that HSD used for machinery and motor vehicles in quarrying operations should qualify for tax concession under Section 8 of the CST Act. The Court referred to Section 8(3)(b) of the CST Act, which specifies goods intended for use in manufacturing, processing, mining, or generation of power. In Indian Copper Corporation Ltd. v. Commissioner of Commercial Taxes, the Supreme Court held that vehicles used for removing mined material to the factory and carrying finished products qualify for tax concession under Section 8(3)(b). Similarly, in J.K. Cotton Spinning and Weaving Mills Co., Ltd. v. Sales Tax Officer, the Supreme Court emphasized that goods integrally related to the manufacturing process qualify for special treatment under Rule 13 of the CST Act. Applying these principles, the Court noted that the petitioner-Company uses HSD oil for its machinery and motor vehicles in quarrying operations. The Government Pleader contended that tax concession should only apply to fuel used for machinery, not motor vehicles. However, the Court, relying on the ratio of Indian Copper Corporation Ltd., held that vehicles used for transporting quarried material are integral to the mining process and qualify for tax concession. Conclusion: The writ petition was allowed. The Court directed the respondents to permit the petitioner-Company to access the online facility (KVATIS) to download the necessary C-forms and dispose of the petitioner's application at the earliest.
|
