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TMI Blog2021 (11) TMI 550X X X X Extracts X X X X X X X X Extracts X X X X ..... . Thus, it could not be said gainsaid that this notification has to be given prospective effect. However, it is observed that the notification dated 31.03.2006 was amended by notification dated 04.04.2007 by giving effect to the entries at Sl.Nos.28 and 29 with effect from 01.01.2007, this notification dated 07.07.2007 with respect to item Nos. 28 and 29 came into effect from the 01.01.2007. These aspects though have been analysed by the Tribunal and benefit has been denied under this notification dated 07.07.2007, on different ground altogether, which was not the subject matter of the appeal. Hence, there are no hesitation to hold that the Tribunal has exceeded its jurisdiction in adjudicating upon other issues which were not considered by either the Assessing Authority or Appellate Authority for denying the benefit of notification dated 07.07.2007 or in other words, to levy taxes under the residual entry on these MFPs for the periods in question. The questions of law is answered in favour of the assessee and against the revenue - petition allowed. - S.T.R.P. NO. 352 OF 2017 - - - Dated:- 1-10-2021 - HON BLE MRS. JUSTICE S. SUJATHA AND HON BLE MR. JUSTICE RAVI V. HOSMANI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2006 by virtue of amendment and substitution by Notification dated 04.04.2007? 3. The assessee/petitioner is a company and a dealer registered under the provisions of the KVAT Act. The assessee carries on business of trading of computer and its accessories, printers, stationary items etc. Audit of the books of accounts of the assessee was taken up by the prescribed authority for the tax periods January to March-2007. Pursuant to which, tax was levied on the sale of Multi Function Printers (MFPs) at the rate of 12.5% as unscheduled goods under Section 4(1)(b) of the KVAT Act for these periods, on the ground that the relevant notifications does not cover the printers sold by the petitioner. The assessment orders for the tax periods in question were passed accordingly. 4. Being aggrieved, the assessee preferred appeals before the First Appellate Authority. The reassessment orders passed for these tax periods were confirmed by the First Appellate Authority holding that MFPs are liable to tax at 12.5% as unscheduled goods. Being aggrieved by the said common order, the assessee preferred appeals before the Tribunal. 5. Though the Tribunal held that undoubtedly, the machine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ers Societies Union Ltd. others Vs. State of Karnataka and others. 3. (2015) 31 GSTR 50 (Kar): Commissioner of Central Excise and Service Tax Vs. Fosroc Chemicals (India) P. Ltd. 8. Learned AGA appearing for the State referring to the notification dated 07.07.2007, submitted that the notification dated 31.03.2006 substituting Sl.Nos.28 and 29 and the entries relating thereto, has to be given prospective effect. The Tribunal having considered these aspects though observed that the machines which perform multiple functions of printing, copying etc., would certainly come within the ambit of this notification but in the absence of the material placed on record by the assessee, to establish that the goods/MFPs dealt by it would come within the ambit of this notification, rejected the appeal preferred by the assessee denying the benefit of the notification dated 07.07.2007 read with the notification dated 31.03.2006, which has been claimed by the appellant. 9. Having heard the learned counsel for the parties and perusing the material on record, it is apt to refer to the relevant notifications which are applicable to the facts of the present case and the adjudication of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Parts of goods specified in sub heading 8501.10.11 and 8501.10.12 8. 8504 Uninterrupted Power Supplies (UPS) and their parts 9. 8519.99.40 MP-3 Player 10. 8523 Prepared unrecorded media for sound recording or similar recording of other phenomena, other than products of Chapter 37 of the Central Excise Tariff Act, 1985. 11. 8524 Records, tapes and other recorded media for sound or other similarly recorded phenomena, including matrices and masters for the production of records, but excluding gramophone records, audio cassettes and products of Chapter 37 of the Central Excise Tariff Act, 1985. 12. 8529.10 Aerials, antennas and parts; parts of goods specified in sub-headings 8525.10, 8525.20 and 8527.90. 13. 8531 Indicator panels incorporating liquid crystal devices (LCD) or light emitting diodes (LED) and parts thereof. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be covered by the scope of this notification. (3) Subject to Explanation 2, for the purpose of any entry contained in this notification, where the description against any heading or, as the case may be, sub-heading, matches fully with the corresponding description in the Central Excise Tariff, then all the commodities covered for the purposes of the said tariff under that heading or sub-heading will be covered by the scope of this notification. (4) Where the description against any heading or sub heading is shown as other then the interpretation as provided in Explanation 2 shall apply. 10. This notification was amended by notification FD 43 CSL 07(I) Bengaluru dated 23.03.2007 with immediate effect issued by the Government of Karnataka in exercise of powers conferred by clause (a) of sub-section (1) of Section 4 read with Entry 53 of the Third Schedule to the Karnataka Value Added Tax, 2003 read with Section 32 of 2004 read with Section 21 of the Karnataka General Clauses Act, 1899. In the said notification entries relating to Sl.No.24 to 29 were inserted. The relevant portion of the said notification reads thus: 9. After Serial Number 23 and the entries ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... numbers 28 and 29 and the entries relating thereto, the following shall be substituted, namely: 28. 84443.31.00 Machines which perform two or more of the functions of printing, copying or facsimile transmission, capable of connecting to an automatic data processing machine or to a network. 29. 8443.32.00 Other, capable of connecting to an automatic data processing machine or a to a network. 30. 8443.99.00 Parts and accessories of goods of sub-headings 8443.31 and 8443.32 including ink cartridges, with print head assembly and ink spray nozzle. 13. The assessing authority placing reliance on the clarification dated 29.02.2008 issued by the Commissioner of Commercial Taxes in respect of other dealers dealing with MFPs proceeded to analyse these notifications. Merely for the reason that the notification dated 07.07.2007 was not issued under Section 30 of the KVAT Act, the Tribunal held that the said notification could not be applied restrospectively and it is not an amendment to the notifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the known and well-recognised practices employed in legislative drafting. Substitution has to be distinguished supersession or a mere repeal of an existing provision. 25. Substitution of a provision results in repeal of the earlier provision and its replacement by the new provision (See Principles of Statutory Interpretation, it is to be found in West U.P. Sugar Mills Assn. V. State of U.P., State of Rajasthan V. Mangilal Pindwal, Koteswar Vittal Kamath V. K.Rangappa Baliga and Co. and A.L.V.R.S.T. Veerappa Chettiar V. S.Michael. In West U.P. Sugar Mills Association case a three-Judges Bench of this Court held that the State Government by substituting the new rule in place of the old one never intended to keep alive the old rule. Having regard to the totality of the circumstances centring around the issue the Could held that the substitution had the effect of just deleting the old rule and making the new rule operative. In Mangilal Pindwal case this Court upheld the legislative practice of an amendment by substitution being incorporated in the text of a statute which had ceased to exist and held that the substitution would have the effect of amending the operation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n a subsequent Act amends an earlier one in such a way as to incorporate itself, or a part of itself, into the earlier, then the earlier Act must thereafter be read and construed (except where that would lead to a repugnancy, inconsistency or absurdity) as if the altered words had been written into the earlier Act with pen and ink and the old words scored out so that thereafter there is no need to refer to the amending Act at all. 17. In the light of these legal principles enunciated by the Hon ble Courts, it is well settled that the substitution has two steps. First, the old provision is made seized to exist and next, the new provision is brought into existence in its place. Both these steps are taken simultaneously thereby replacing old provision with the new provision. The notification dated 07.07.2007 would certainly indicate that the substitution has been made to Sl.Nos. 28 and 29 and entries relating thereto, existing in the notification dated 31.03.2006. Thus, it could not be said gainsaid that this notification has to be given prospective effect. However, we have observed that the notification dated 31.03.2006 was amended by notification dated 04.04.2007 by giving effe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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