9911796707
TMI Blog2022 (6) TMI 99X X X X Extracts X X X X X X X X Extracts X X X X ..... 005, the appellant / assessee has come up with this writ appeal. 2.The necessary facts leading to the filing of this writ appeal would run thus: 2.1. The appellant was engaged in the business of selling/marketing of pre-recorded audio cassettes and was registered under the provisions of the Tamil Nadu General Sales Tax Act, 1959 (in short, "the TNGST Act") and the Central Sales Tax Act,1956 (in short, "the CST Act"). During the course of such business, the appellant used to purchase pre-recorded audio cassettes from the suppliers in Tamil Nadu, who were also registered under the TNGST Act and who charged sales tax under the TNGST Act for the sales of pre-recorded audio cassettes. Further, the appellant used to acquire audio rights from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... refore, the sales made by the supplier cannot be regarded as first sales. 2.3. According to the appellant, Section 16 of the Act can be pressed into service only if it is established that there is escapement of turnover with a wilful non-disclosure of assessable turnover, whereas in this case, there is no reason assigned by the Assessing Officer as to why Section 16 of the Act was invoked. It is further stated that the appellant has claimed second sale exemption as the pre-recorded cassettes have already suffered tax at the point of first sale and the same has also been accepted by the Department, at the time of passing the assessment orders. While so, invoking Section 16 of the Act for re-opening the assessment is uncalled for. In support ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... smissed the aforesaid writ petition on 06.09.2021 upholding the validity of the Circular dated 16.05.2003 by observing that the transaction between the assessee and the cassette manufacturer is not a sale, but only a works contract. Therefore, this writ appeal. 3.The learned counsel appearing for the appellant contended that the transaction between the cassette manufacturers and the appellant is not covered under the definition of 'works contract' in terms of Section 2(u) of TNGST Act as stated in the circular dated 16.05.2003. The activity of cassette manufacture is liable to central excise duty and the State has no jurisdiction to treat the same as 'deemed sale' for the purpose of sales tax. The learned counsel further co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d returned to the petitioner and for this transaction, the customers have raised sale bills against the petitioner-company as if pre-recorded audio cassettes were sold and the petitioner, in turn, has sold the pre-recorded cassettes as second sale and claimed exemption as second sale of pre-recorded casssettes. The reason stated by the second respondent for bringing the relevant turnover to tax is that the person (customer) who has undertaken the recording work has no right to sell the recorded cassettes, because he has done the job of recording for labour on works contract basis, for which, the customers have also received labour charges and on that basis, the petitioner, who holds right over the audio cassettes, was treated as the first s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Accordingly, the impugned order dated February 28,2003 is set aside and the matter is remitted to the second respondent to redo the assessment in accordance with law, after verifying the various purchases made by the petitioner as to the sufferance of sales tax at the earlier stage, consider the clarification/circulars issued by the Commissioner of Commercial Taxes as required under section 28-A(3) of the Act, the relevant appellate order and other decisions relied on in the present original petition. If the assessing authority purports to deviate from section 28-A clarification in force, being a quasi-judicial authority, he has to state reasons for such deviation." 5. Adding further, the learned counsel for the appellant submitted that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... settes/CDs. Due to invent of technology cassettes were replaced by CDs, thereafter pen drive and now only through digital media and direct download from the internet. As early as 2006 the appellant has stopped the business of selling of cassettes and CDs." With these averments, the learned counsel confined the relief sought for in the writ petition against the assessment and prayed this Court to direct the first respondent / Assessing Officer to re-do the assessment in accordance with law after verifying the various purchases made by the appellant, as to whether the goods included in the invoice have already suffered tax at the earlier stage in the light of the various clarification/circulars issued by the Commissioner. 6. On the above co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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