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TMI Blog2013 (4) TMI 682X X X X Extracts X X X X X X X X Extracts X X X X ..... linder oil" is not one of the petroleum products included in entry 67 for the purpose of levying tax under section 3(1) of the Act, the same does not find place in the notification issued under the said provisions. The order passed by the first appellate authority setting aside the order passed by the assessing authority was legal and valid. The revisional authority committed a serious error in interfering with such an order without reading the invoice properly. Thus, the impugned order is liable to be set aside. Appeal allowed. - TAET Nos. 7, 8, 9 of 2011 - - - Dated:- 17-4-2013 - KUMAR N. AND MANOHAR B., JJ. For the Appellant : Smt. Rukmani Menon. For the Respondents : T K. Vedamurthy, Additional Government Advocate,. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecting the returns, books of accounts and other relevant documents, the authority passed the assessment order dated June 30, 2009 under section 5(4) of the Act for the three assessment years. The assessing authority held that the oil purchased and caused entry by the assessee was liable to tax under section 3(1) of the Act read with the notification dated March 30, 2002 at the rate of five per cent. The authority held that the goods caused entry by the assessee were liable to be classified as lubricating oil , which was taxable at the rate of five per cent. Penalty and interest were also levied. Aggrieved by the said order, the assessee preferred an appeal before the Joint Commissioner of Commercial Taxes (Appeals-2) (hereinafter referred ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the appellant Smt. Rukmani Menon assailing the impugned order contended that the levy of tax under section 3(1) of the Act is permissible only in respect of goods which are mentioned in the First Schedule. Entry 67 deals with the petroleum products. In the said entry there is no reference to IPOL cylinder oil whereas there is a specific reference to the lubricating oil in the notification issued under the said Act. Five per cent tax is levied on the goods mentioned in entry 67. The IPOL cylinder oil is the base oil. It is not one of the oils mentioned in entry 67 read with notification. No tax is leviable under the Act under subsection (1) of section 3 of the Act. The reliance was placed by the authorities on the invoice and reading ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... chedule into a local area for consumption, use or sale therein, at such rates not exceeding five per cent of the value of the goods as may be specified retrospectively or prospectively by the State Government by Notification. Different dates and different rates may be specified in respect of different goods or different classes of goods or different local areas. 8. First Schedule to the Act specifies items of goods on which tax is levied. Item No. 67 deals with the petroleum products which reads as under: Petroleum products; that is to say; petrol, diesel, crude oil, lubricating oil, transformer oil, brake or clutch fluid, bitumen (asphalt), tar and others, but excluding aviation fuel, liquid petroleum gas (LPG), kerosene and na ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t classification has no application under this Act. Under the said invoice, it is clearly mentioned that the oil which is purchased is IPOL cylinder oil 1200 . 10. The first appellate authority in its judgment has briefly narrated how the lubricating oil is manufactured, which reads as under: The base oil (cylinder oil) is heated to 180 to 200 degree C to prepare the base grease. At this juncture, thickners and chemicals are added (Komad+ IPA). It is allowed to set the grease. After cooling, different types require additives are added (OGM + graphite) for creating load capacity and to give lubricating properties. For certain variety of grease, polybutenes are added to make the grease adhesive. With this process, the base oil, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the applicant which is used as raw material is exempt from levy of entry tax as per Notification No. FD 11 CET 2002, dated March 30, 2002. 12. The test certificate issued by M/s. Shiva Analyticals (India) Limited after examining the IPOL cylinder oil has given the contents of the same and their opinion that the sample appears to be base oil and not the lubricating oil. Even the revisional authority in the impugned order has observed as under: No doubt, the assessee is involved in upgrading the goods bought by them for the purpose of marketing and usage and this process of upgrading the lubricating oil for refinement does not take away the legal liability on the goods. 13. The revisional authority has proceeded on the ground ..... X X X X Extracts X X X X X X X X Extracts X X X X
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