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TMI Blog2024 (8) TMI 198X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Constitution of India, 1950 prohibits the State from extracting tax from the citizens without the authority of law. The tax statutes have to be interpreted strictly which means that the legislature mandates taxing certain persons in certain circumstances which cannot be expanded or interpreted to include those who were not intended or comprehended. The assessee is not to be taxed without clear words and, for that purpose, the same must be according to the natural construction of the words which have been used in that statute. These words have to be read as it is and thus cannot be added or substituted which may give a meaning other than what is expressed in the provision. In the light of the definition as provided for under Section 2(18) of the GVAT Act, it becomes obvious that the definition is enumerative and exhaustive. The use of the word means denote the intention of the legislature to restrict the scope of the purchase price to the categories enumerated in the definition itself. The purchase price, therefore, would be the amount of valuable consideration paid or payable for any purchase which would include amount of duties, levied or leviable under the two acts as has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal is that the Courts below have erred in holding that Value Added Tax and value of purchases on which no tax credit was claimed nor granted in the assessment, cannot be included in the aggregate of taxable turnover of purchases within the State for the purpose of reduction of tax credit under Section 11(3)(b) of the Gujarat Value Added Tax Act, 2003 (hereinafter referred to as the GVAT Act ). 3. Two substantial questions of law being framed by the High Court were as follows : - [1] Whether the Hon'ble Tribunal has erred in law and in facts in holding that value added tax paid on purchases is required to be excluded for computing taxable turnover of purchases under section 11(3)(b) of the Act? [2] Whether the Hon'ble Tribunal has erred in law and in facts by holding that purchases on which value added tax is neither claimed nor granted are required to be excluded for computing taxable turnover of purchases under section 11(3)(b) of the Act? 4. The learned senior advocate appearing for the Appellant has asserted that the Respondent dealer essentially calculated the taxable turnover of its purchases under the GVAT Act by excluding the Value Added Tax and value of purchase ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it was prayed for the dismissal of the present appeals. 8. We have considered the submissions made by the learned counsel for the parties and have gone through the provisions, as well as the pleadings. 9. In brief, the facts of the case are that the Respondent dealer as mentioned calculated the taxable turnover of its purchases within the State of Gujarat by excluding the amount representing Value Added Tax and value of purchases of which no credit was claimed. This was asserted to have been done under the provisions of Section 11(3)(b) of the GVAT Act. Accordingly, the taxable turnover was calculated and proportionately reduced by four per cent on the quantity of goods involved in the manufacturing of goods dispatched by way of branch transfer. 10. The Deputy Commissioner during the process of audit assessment determined the taxable turnover of purchases within the State by including the tax amount i.e., Value Added Tax Amount and Value of Purchases on which no tax credit was claimed by the Respondent dealer nor proposed to be granted in the assessment. On the basis of this assessment, the Respondent being aggrieved preferred an appeal before the Joint Commissioner which was dismi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not only exclusive but exhaustive as well, it can rather be said to be enumerative. The first and foremost duty of the Court is to read the statute as it is and if the words therein are clear and unambiguous then only one meaning can be inferred. The Courts are bound to give effect to the said meaning irrespective of the consequences so far as the taxation statutes are concerned. Article 265 of the Constitution of India, 1950 prohibits the State from extracting tax from the citizens without the authority of law. The tax statutes have to be interpreted strictly which means that the legislature mandates taxing certain persons in certain circumstances which cannot be expanded or interpreted to include those who were not intended or comprehended. The assessee is not to be taxed without clear words and, for that purpose, the same must be according to the natural construction of the words which have been used in that statute. These words have to be read as it is and thus cannot be added or substituted which may give a meaning other than what is expressed in the provision. 13. In the case of Commissioner of Wealth Tax, Gujarat-III, Ahmedabad v. Ellis Bridge Gymkhana 1998 (1) SCC 384 this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ector of Technical Education in accordance with the directions issued by the AICTE from time to time. 15. In the light of the above reproduced definition as provided for under Section 2(18) of the GVAT Act, it becomes obvious that the definition is enumerative and exhaustive. The use of the word means denote the intention of the legislature to restrict the scope of the purchase price to the categories enumerated in the definition itself. The purchase price, therefore, would be the amount of valuable consideration paid or payable for any purchase which would include amount of duties, levied or leviable under the two acts as has been provided for in this Section apart from the other charges as expounded therein. The scope has been limited to the two Acts mentioned in the Section itself. The same could not be expanded and therefore it can be safely said that the intention of the legislature was to exclude Value Added Tax from the ambit of purchase price as the same is not found mentioned in the categories of tax/duties enumerated thereunder. Sub-Section (32) of Section 2 of the GVAT Act defines turnover of purchases which reads as follows: - 2. In this Act, unless the context otherwis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rchases with in the State. ] 17. The cogent reading of sub-Section (18) of Section 2 which defines purchase price , sub- Section 32 of Section 2 which defines turnover of purchases , and Section 11 of the GVAT Act which deals with entitlement to the tax credit, would lead to only one conclusion, that the purchase price would not include purchases on which no value added tax was claimed nor granted and the component of value added tax stood already paid on purchases. Accordingly, the taxable turnover of purchases would have to be calculated after deducting both the components as has been detailed aforesaid. 18. Therefore, the calculation of taxable turnover of the purchases and reduction value of purchases on which no tax credit was claimed nor granted, and component of value added tax already paid on purchases, was rightly excluded from the total turnover of the Respondent dealer while computing his tax liability under Section 11(3)(b) of the GVAT Act. 19. The order passed by the Tribunal as has been upheld vide the impugned judgment of the High Court being in accordance with law calls for no interference and therefore, the appeals deserve dismissal. 20. The appeals, accordingly, s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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