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2022 (8) TMI 415 - HC - VAT and Sales TaxLevy of Entry Tax - aluminum extrusion - falls under Entry 11 of Part I of the Schedule of the OET Act or not - levy of penalty under Section 7(5) of the OET Act undisputedly when the assessment was completed under Section 7(3) of the OET Act - HELD THAT - In K.V. MATHEW VERSUS DISTRICT MANAGER, TELEPHONES, ERNAKULAM AND ORS. 1983 (10) TMI 296 - KERALA HIGH COURT the High Court was considering the expression institution and in the context of scope of the expression, it was held that the word et cetera does not share the character of an inclusive definition and cannot therefore enlarge the scope of the expression institution'. Where the entry is meant to include all kinds of products, the entry itself would read like it does in the case of Tobacco. In fact, in the context of entry Tobacco and Tobacco products , this Court has recently in M/S. PATEL BROTHERS CO. VERSUS STATE OF ODISHA 2022 (8) TMI 253 - ORISSA HIGH COURT has held that bidis would form part of tobacco products . If Entry 11 had read sheets, rods of non-ferrous metals including Aluminum and products thereof , then it would have been arguable that it covered Aluminum extrusions as well. However, the word here used is etc. and it is used soon after the words sheets, rods and, therefore, will include only a similar kind of product i.e. like sheets and rods. Aluminum extrusions, the pictures of which are readily available on the net, and which were viewed in the Court in the presence of the counsel, are distinct and different from sheets and rods. The Court is of the view that Aluminum extrusions brought into Odisha from outside Odisha by the Petitioner is not exigible to entry tax @ 1% since it is not covered by Entry-11 of Part-I of the Schedule to the OET Act - application is answered in the negative by holding that the Tribunal was not justified in upholding the levy of penalty under Section 7 (5) of the OET Act - petition disposed off.
Issues:
1. Interpretation of Entry 11 of Part-I of the Schedule to the Orissa Entry Tax Act, 1999. 2. Justification of penalty under Section 7(5) of the OET Act. Interpretation of Entry 11: The case involved a dispute regarding the liability to pay entry tax on Aluminum extrusions under Entry 11 of the Schedule to the Orissa Entry Tax Act, 1999. The Tribunal had held that Aluminum extrusions were amenable to tax at 1%, rejecting the Assessee's contention that no entry tax was payable on goods not mentioned in the Schedule. The High Court analyzed the legislative intent behind the wording of Entry 11, focusing on the use of the term "etc." The Court emphasized the principle of strict interpretation in taxation law and referred to precedents emphasizing the understanding of terms in trade and commerce. The Court concluded that Aluminum extrusions did not fall under Entry 11 as they were distinct from "sheets" and "rods" mentioned in the entry, ultimately ruling in favor of the Assessee. Justification of Penalty: The Court also addressed the issue of the Tribunal upholding the levy of penalty under Section 7(5) of the OET Act. Given the ruling on the interpretation of Entry 11, the Court held that the Tribunal was not justified in imposing the penalty. The Court's decision on the first issue influenced the outcome of the penalty issue, leading to a negative answer regarding the justification of the penalty under Section 7(5) of the OET Act. Consequently, the impugned orders of the Tribunal, Sales Tax Officer, and Assistant Commissioner of Sales Tax were set aside, and the petition was disposed of in favor of the Assessee.
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