2023 (6) TMI 841 - HC - VAT and Sales Tax

Classification of goods - rate of tax - stainless steel scrap - to be taxable at the rate of 2% under the Himachal Pradesh Tax on Entry of Goods into Local Area Act, 2010 or taxable at the rate of 0.25% under Entry No. 9 of Schedule-II appended to the Entry Tax Act? - HELD THAT - The clear mandate of law is that this Court can exercise revisional jurisdiction under Section 48 of the Act only against the orders passed by Tax Tribunal either under Section 45(2) or Section 46(3) of the VAT Act. Such jurisdiction can be exercised if the person aggrieved applies to this Court within 90 days of the communication of the order and also if the involvement of any question of law arising out of erroneous decision of law or failure to decide a question of law is found to exist. The impugned order passed by the Tax Tribunal in rectification application filed by the petitioners under Section 47 of the VAT Act is not open to challenge by the petitioners before this Court under Section 48 of the VAT Act. Petitioners can also not be allowed to assail the order dated 20.06.2017, passed by the Tax Tribunal being clearly beyond the period of limitation, as prescribed under Section 48 of the Act - There is no denial to the fact that no distinction has been made in the Entry Tax Act between ferrous metal and alloys and non ferrous metal and alloys. The Tax Tribunal has rightly interpreted the terms of the Entry Tax Act as decipherable from its provision and entries in the Schedule appended thereto. The alloys have been included in Entry 19(b) of Schedule-II to the Entry Tax Act, which has been declared to be taxed at the rate of 0.25%. The Tax Tribunal had rightly interpreted the terms of Schedule-II appended to Entry Tax Act by holding that the tax statutes have to be read as it is without inferring anything extra. There are no erroneous decision of law or failure to decide a question of law in the impugned order dated 20.06.2017 passed by the Tax Tribunal, therefore, no question of law has arisen for consideration of this Court - petition dismissed.

Summary

Issues involved:
1. Interpretation of the Himachal Pradesh Value Added Tax Act, 2005 regarding the taxation of stainless steel scrap.
2. Jurisdiction of the High Court under Section 48 of the VAT Act to revise orders passed by the Tax Tribunal.

Issue 1: Interpretation of the Himachal Pradesh Value Added Tax Act, 2005 regarding the taxation of stainless steel scrap.
The respondent was assessed to pay an additional sum under the Himachal Pradesh Tax on Entry of Goods into Local Area Act, 2010 for considering stainless steel scrap as a ferrous metal and alloy taxed at 2%. The Tax Tribunal accepted the respondent's appeal, classifying stainless steel scrap as a non-ferrous alloy taxable at 0.25%, thereby quashing the demand raised by the revenue. The petitioners' rectification application was dismissed by the Tax Tribunal, stating no apparent error in the previous order.

Issue 2: Jurisdiction of the High Court under Section 48 of the VAT Act to revise orders passed by the Tax Tribunal.
The petitioners sought revision of the Tax Tribunal's orders under Section 48 of the VAT Act, alleging erroneous decision of law. However, the High Court clarified that its revisional jurisdiction is limited to orders under Section 45(2) or Section 46(3) of the VAT Act, excluding rectification applications under Section 47. The Court found no grounds for interference with the Tax Tribunal's interpretation of the Entry Tax Act, emphasizing the need to adhere to the statute's provisions without implying additional elements. Consequently, the petition was dismissed for lack of any legal question necessitating the Court's consideration.