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TMI Blog2018 (12) TMI 1231X X X X Extracts X X X X X X X X Extracts X X X X ..... for compounding under Section 8 of the Act? Held that:- Section 8(b) is very clear and indicates compounding fee only on the specific machines provided there under with respect to a dealer producing granite metals. True, the legislature never contemplated the introduction of vertical or horizontal shaft impactors for the purpose of producing M-Sand from the granite metal produced by a separate process through an impactor. The exemption granted, did not exclude such production by a separate machine other than that specified in clause (b) of Section 8 - The exemption granted as per the proviso applies across the board to any production of manufactured sand made by the dealers producing granite metals whether it be from the machines as spec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled by the assessee against the issuance of of a notice under Section 67 of the Kerala Value Added Tax Act, threatening imposition of penalty. Since the appeals were dismissed by a common judgment, necessarily the judgment has to be recalled. Hence we recalled the common judgment dated 12.11.2018. However, since there is absolutely no change in the findings, we pass the following judgment. 2. The issue raised in the above writ appeals is as to whether the M-Sand produced by the various writ petitioners by using a vertical/horizontal shaft impactor machine is liable to separate assessment under the Kerala Value Added Tax Act, 2003 (for brevity KVAT Act); even when the dealers had opted for compounding under Section 8 of the Act. 3. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e exemption was only on account of such M-Sand obtained as a by-product, in production of granite metals in the machines specified in sub-section (b) of Section 8 would be of a negligible quantity and also inferior quality. The budget speech for the assessment year in which there was introduction of VSI/HSI also under the compounding scheme, has also been relied on to further buttress the intention of the legislature in having provided the coverage under the scheme only prospectively from the assessment year 2014-15. 5. We have heard learned Special Government Pleader Sri. C.E Unnikrishnan for the State and Sri. S.Sreedev for the assesseeappellant. The learned Senior Counsel Sri Raju Joseph Sri. T.M. Sreedharan as also Sri. Harisankar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th are saleable as M-Sand in the market. 8. The learned Single Judge found that it was not in dispute that the products,namely granite metal, crusher sand and manufactured sand are all obtained during the process of production of granite metal using mechanised crushing machines. M-Sand was also found to be a product that is obtained in the process of production of granite metal using mechanised crushing machines. It was specifically held that the mere fact that a dealer had obtained a different type of machine for production of a finer size of granite metal or sand was of no consequence. We agree with the findings; on the legislative scheme envisaging the payment of compounded fee on the basis of the number of primary and secondary crush ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh an impactor. The exemption granted, did not exclude such production by a separate machine other than that specified in clause (b) of Section 8. The exemption granted as per the proviso applies across the board to any production of manufactured sand made by the dealers producing granite metals whether it be from the machines as specified in Clause (b) or otherwise. The compounding scheme also is for the dealers or the crushing units and on option exercised, they are absolved from regular assessment of the goods produced in the crusher units whether it be larger or smaller aggregates of granite metal or M-Sand by a VSI/HSI. 10. We also notice that the legislature having found that there is a loss of tax insofar as the M- Sand produced b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pounding fee for the VSI/HSI also separately. This in fact further fortifies the contention of the dealers that prior to such introduction they were entitled to the exemption, whether the M-Sand produced in the Units, which opted for compounding, did so from the crushers or the impactors. We do not also see any reason to sustain the distinction sought to be drawn between M-Sand and manufactured sand. M-Sand as it is generally understood is manufactured sand produced from quarried metals. In common parlance as also in commercial parlance M-Sand is manufactured sand produced from metals, as distinguished from natural sand. 12. We have also seen Poabs Granite P.Ltd. (supra) which decision was under the general sales tax regime. The compou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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