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2001 (7) TMI 124 - SC - VAT and Sales TaxInterpretation of Entry 24-B of the First Schedule to the Andhra Pradesh General Sales Tax Act, 1957 Held that - The words used in Entry 24-B plainly indicate that it is applicable to all vegetable oil (refined) that is obtained from the kinds of non-refined oil that are described in Entry 24-A, that is, from non-refined oil other than rice bran oil. The word mentioned only means described or set forth and no more. There was, therefore, no justification for the conclusion that only vegetable oil (refined) obtained from non-refined oil that had been subjected to tax under Entry 24-A could be taxed at the rate of 2 paise. Further, where the Schedule intended to refer to goods which were made from inputs that had suffered tax under the Act, the Schedule so stated. Yet again, the fact that before its amendment, Entry 24 had used the words if it had met tax under the Act and these words were omitted after the amendment shows that the construction that we have placed upon Entry 24-B is correct. Appeal allowed. The orders of assessment made on the basis of the interpretation placed by the State on Entry 24-B are set aside.
Issues:
Interpretation of Entry 24-B of the Andhra Pradesh General Sales Tax Act, 1957. Analysis: The judgment pertains to the interpretation of Entry 24-B of the Andhra Pradesh General Sales Tax Act, 1957. The dispute revolved around the application of tax rates to refined vegetable oils obtained from non-refined oils mentioned in Entry 24-A. The Government of Andhra Pradesh issued circulars specifying that only oils obtained from non-refined oils subject to tax under Entry 24-A were eligible for a concessional rate of 2%, while imported refined oils were taxable at 10%. The High Court, while striking down the circulars, interpreted Entry 24-B to imply that only refined oils from non-refined oils taxed under Entry 24-A were subject to a 2% tax rate. This interpretation was challenged in the appeals. The appellants argued that the term 'mentioned' in Entry 24-B simply indicated that it applied to all refined vegetable oils obtained from non-refined oils described in Entry 24-A, without necessitating that the non-refined oils had to have suffered tax under Entry 24-A. They highlighted the absence of specific language requiring tax payment under Entry 24-A for the application of Entry 24-B. Conversely, the State contended that only refined oils from non-refined oils taxed under Entry 24-A could be taxed at 2%, while those not taxed under Entry 24-A were subject to a 10% tax rate. The Supreme Court analyzed the wording of Entry 24-B and concluded that it applied to all refined vegetable oils obtained from non-refined oils specified in Entry 24-A, irrespective of whether the non-refined oils had been taxed under Entry 24-A. The term 'mentioned' was construed to mean "described" or "set forth," without requiring prior taxation under Entry 24-A. The Court emphasized that the Schedule explicitly indicated when goods made from taxed inputs were intended, which was not the case with Entry 24-B. Moreover, the Court noted the absence of language mandating tax payment under Entry 24-A for the application of Entry 24-B, unlike in other Schedule entries. Consequently, the Court allowed the civil appeals, set aside the challenged judgments and orders, and directed the State to refund the deposited sums to the appellants. The respondents were also ordered to bear the costs of the appeals.
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