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TMI Blog2017 (9) TMI 680X X X X Extracts X X X X X X X X Extracts X X X X ..... amely, fertiliser, liquefied Petroleum Gas or PDS Kerosene as the case may be, at prices fixed by the Government of India and what is reimbursed by the Government of India is not part of the price or the difference between the purchase price or sale price. Only if what is reimbursed is the balance of the price, then and then alone, Explanation VII would be of relevance. Therefore, even in spite of the incorporation of Explanation VII to Section 2(Iii) of the KVAT Act, the legal position that subsidy received by dealers like the respondents herein cannot form part of their turn over remains unaltered. Appeal dismissed - decided against Revenue. - W.A.Nos.20, 43, 61, 64, 536, 130, 137, 140, 165, 307, 396, 416, 420, 562 of 2016 & O.T.Rev.No.178 of 2015 - - - Dated:- 1-8-2017 - Antony Dominic And Dama Seshadri Naidu, JJ. For the Petitioner : Sri. Muhammed Rafiq For the Respondent : Sri John T. Paul JUDGMENT Antony Dominic, J. These writ appeals are filed by the State of Kerala and its officers impugning the judgments of the learned Single Judge. Some of the writ petitions were filed by the companies manufacturing as also importing fertilizers and some of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt and the Apex Court were rendered in the context of the provisions contained in the Kerala General Sales Tax Act and that having regard to the provisions contained in the Kerala Value Added Tax Act, re- examination of the issue is necessary. According to him, in terms of Section 6(1), every dealer having a total turnover beyond the limit prescribed therein is liable to be levied tax on sale or purchase of goods. It was pointed out that Section 2(I) defines 'taxable turnover' as turnover on which dealer shall be liable to pay tax and that Section 2(Ii) defines 'total turnover' as aggregate turnover in all goods of a dealer at all places of business in the State. 5. Our attention was invited to Section 2(Iii) which defines 'turnover' and particularly, Explanation VII thereof. Section 2(Iii) and Explanation VII of the KVAT Act, 2003 are extracted below for reference: Section 2(Iii) turnover means the aggregate amount for which goods are either bought or sold, supplied or distributed by a dealer, either directly or through another, on his own account or on account of others, whether for cash or for deferred payment or for other valuable consideration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Apex Court in its judgment in Neyveli Lignite Corporation Ltd. (supra), thus: 11. In the instant case, as far as the Fertilizer (Control) Order is concerned, the appellant is only required to receive either the fixed price determined or the maximum price which may be fixed. For example, vide notification dated 30th January, 1988, maximum price per tonne of different types of fertilizer specified therein was fixed. In respect of urea, the maximum price per tonne fixed was ₹ 2,350. No manufacturer of urea could sell the same at a price in excess of ₹ 2,350. The Explanation in the said notification provided that the maximum price so fixed was to be inclusive of Central sales tax, State sales tax or other local taxes wherever levied. Neither in the notification nor in the Fertilizer (Control) Order is there any reference to the Retention Price Scheme of the Government. 12. The Retention Price Scheme first enunciated by letter dated 31st December, 1977 is clearly an administrative decision of the Government of India. It has been issued pursuant to the Ministry's Resolution and it enables a factory, like the appellant, to receive subsidy from the Government in c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion Price Scheme. 9. Insofar as the subsidy distributed under the PDS Kerosene and the Domestic LPG Subsidy Scheme is concerned, on the discontinuance of the Administered Pricing Mechanism for petroleum products, the Government of India made the PDS Kerosene and Domestic LPG Subsidy Scheme, 2002 for payment of subsidy on PDS Kerosene and Domestic LPG. The Scheme came into force with effect from 1.4.2002 and from a copy of the Scheme made available during the course of hearing, it is seen that the subsidy under the Scheme was to be given on the sales made throughout the country by the participating companies of kerosene under the public distribution system and LPG cylinders for domestic use. The Scheme further provided that the quantity of PDS kerosene on which the subsidy will be allowed for each State will be limited to allocations made by the Ministry of Petroleum and Natural Gas subject to actual quantities sold. Clause 5 of the Scheme provided for 'determination of the amount of the subsidy'. It is stated therein that subsidy on PDS Kerosene and domestic LPG will be met from the budgetary grants of the Ministry of Petroleum and Natural Gas and that amount of subsidy ..... X X X X Extracts X X X X X X X X Extracts X X X X
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