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TMI Blog2018 (2) TMI 1223X X X X Extracts X X X X X X X X Extracts X X X X ..... at the goods should be used in manufacture. Use may be direct or indirect, in the process of manufacture. Plant and machinery are used for the purpose of manufacturing vanaspathi and bakery shortening. Since the goods are installed and used in the factory site, the respondent-dealer is entitled to the concessional rate of tax at 3%. Therefore, the Tribunal has rightly held that the disputed turnovers are eligible for concessional rate of tax, provided under Section 3(5) of the Tamilnadu General Sales Tax Act, 1959. The assessee has satisfied all the conditions enumerated and Section 3(5) of the Act and hence, they are entitled to the concessional rate of tax under Section 3(5) of the Act - Section 3(5) of the Act is a beneficial provision. It provides for concession in tax to encourage industrial activity. It is well settled principle that a taxing provision, granting concessional and incentives for promoting growth and development, should be construed liberally. Revision dismissed - decided against Revenue. - T. C. (R). Nos. 45 and 46 of 2017 - - - Dated:- 16-11-2017 - S. Manikumar And R. Suresh Kumar, JJ. For the Petitioner : Mrs. Narmada Sampath Special Govt. Plea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3 of the Tamilnadu General Sales Tax Act, 1959 is warranted in this case? 5. After considering the rival submissions and facts and circumstances of the case, the Tribunal, vide common order, dated 08.02.2010, has dismissed the appeals, as hereunder: 4) Point No.(i): That the assessee were assessed to tax under the Tamilnadu General Sales Tax Act, 1959 for the assessment year 2002-2003 vide original assessment order dated 2.11.2005 and for the assessment year 2003-2004 vide the original assessment order dated 27.1.2005. In the said original assessment orders the assessing officer had allowed concessional rate of tax claimed by the assessee for the purchases under Section 3(5) of the Tamilnadu General Sales Tax Act, 1959 by issue of Form XVII declaration forms. Thereafter, the assessing officer had invoked Section 16 of the Tamilnadu General Sales Tax Act, 1959 and assessed the disputed turnover to a higher rate of tax holding that the purchase of spares separately was not eligible for concessional rate of tax provided under Section 3(5) of the Tamilnadu General Sales Tax Act, 1959. The revision order under Section 16(1) was passed on 24.11.2005 and 2.11.2005 for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he goods for sale. Hence, we are of the view that the assessing officer had misconstrued the intend and purport behind the said circular and wrongly applied the same to the case of the assessee. 7) If we hold that the circular relied upon by the revenue does not apply to the facts of our case then there is no other ground or reason made out by the revenue to show that the disputed purchase turnover was not eligible for concessional rate of tax under Section 3(5) of the Tamilnadu General Sales Tax Act, 1959. Hence, we hold that these disputed turnovers are eligible for the concessional rate of tax provided under Section 3(5) of the Tamilnadu General Sales Tax Act, 1959 and this point is answered against the appellant. 8) Point No.(ii): The assessing officer had imposed a penalty under Section 23 read with Section 45(2)(e) of the Tamilnadu General Sales Tax Act, 1959 for the alleged misuse of the Form XVII. While answering Point No.(i) we have held that the assessee were eligible for concessional rate of tax for the disputed turnovers and as such there is no question of any misuse of Form XVII declarations and inturn there is no question of imposition of penalty under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the State for the manufacture of any goods shall be at the rate of three per cent on the turnover relating to such sale. 11. A reading of Section 3(5) of the Act makes it clear that the tax payable by a dealer in respect of sale of goods mentioned in the Eighth Schedule to any other dealer for installation and use in his factory site situate in the State for the manufacture of any goods shall be @ 3% on the turnover relating to such sales. In the present case, the respondent-dealer is a manufacturer, purchased spares, used for the purpose of manufacturing goods. It is not in dispute that the factory is situated within the State of Tamil Nadu and the dealer had manufactured the goods for sale. Spares for the machinery, specifically fall under Clause (3) of Eighth Schedule, which is extracted hereunder, Machineries of all kinds (other than those specifically mentioned in the First Schedule) worked by (i) Electricity (ii) Nuclear Power (iii) Hydro-dynamic and steam power (iv) diesel or petrol (v) Furnace Oil (vi) Kerosene (vii) Coal including coke and charcoal or (viii) any other form of fuel or power (excluding human or animal labour) (ix) parts and accessories of machineri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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