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TMI Blog2019 (7) TMI 1290X X X X Extracts X X X X X X X X Extracts X X X X ..... even if the assessee chooses to knock down such machinery before its import and cause its entry into the local area in three different parts with value of each part at ₹ 5,00,000/-. The interpretation made by the revenue authority and the appellate authorities would allow the parties to alter and present a transaction as taxable or otherwise by creating artificial bifurcations and unity (amongst different transactions), so as to avoid or create existence of a taxable event. Even otherwise, the rule of strict construction of taxing entry suggests that the taxing entry seeks to impose entry tax on input of machinery of value more than ₹ 10,00,000/-. Therefore the valuation of the taxable goods is determinative of their taxabili ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upheld the order passed by the Assessing Authority and the First Appellate Authority by which demand of entry tax has been created and confirmed on the assessee with respect to import of certain machinery and machinery parts. According to the assessee, the value of the individual machinery and the individual spare parts was less than ₹ 10,00,000/-, and therefore, such transactions were not taxable under Schedule Entry No.2 of the U.P. Tax on Entry of Goods into Local Areas Act, 2007 (hereinafter referred to as the 'Act'). 3. The present revision has been heard on the following question of law:- Whether any entry could have been levied on the assessee for import of machineries and spare parts ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... individual spare parts imported exceeded ₹ 10,00,000/- and not otherwise. 7. Therefore, the First Appellate Authority vide his order dated 16.08.2002 allowed the assessee's appeal and remitted the matter to the Assessing Authority to pass a fresh order. Upon remand, by his order dated 25.08.2003, the Assessing Authority again concluded that the composite value of the machinery and spare parts was in excess of ₹ 10,00,000/- in case of four import declaration forms and thus against import Declaration Form nos. 4115959, 4117251, 4118229 and 4116219. The assessee's appeal against the aforesaid order has been dismissed by the Tribunal by the impugned order. Hence this revision. 8. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filament yarn manufactured by it. Similarly, relying on declaration form-F/FF 4115959, it has been submitted that the assessee had only imported numbers of other spare parts for textile machinery. Also, reliance has been placed on the other two import declaration forms utilised to the same effect. Thus, it has been submitted that the assessee did not import any single spare part of value more than ₹ 10,00,000/- and there is no finding that it had in fact made such import. Merely because the total value of the spare parts imported through one import declaration form exceeded ₹ 10,00,000/- though the identity of each spare thus imported was different, no taxable event could arise in view of the clear language of the taxing entry. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ll machinery or of spare parts that may be imported either by way of a single transaction or multiple transactions during the entire year, that position was further made clear by the Commissioner himself while issuing the circular dated 16.03.2000. In that circular, referring to the Schedule Entry noted above, it has been clarified : 15. Thus, under the schedule entry 2, entry tax has been imposed on a machinery that may be imported into a local area of value more than ₹ 10,00,000/- or a single spare part of a machinery whose value may be more than ₹ 10,00,000/-. Therefore, by way of example (only), if value of a single machinery is more than ₹ 15,00,000/-, the same would remain taxable fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e valuation of the taxable goods is determinative of their taxability or otherwise. Once the taxing entry identifies the total of value of a single machine (which would be more than the sum total of value of it's parts), as the factor giving rise to it's taxability, the same test of value would determine the taxability or otherwise of the spare parts. Otherwise, it would lead to contradictory results. This position has also been made plain by the circular noted above. 17. The same view has been taken by the learned Single Judge of this Court in the case of M/S. Skipper Steels Ltd. Mall Avenue Road Lucknow Vs Commissioner of Commercial Tax, U.P., Lucknow (supra) with which I am in full agreement. 18. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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