The issue pertained to the categorization of galvanized iron ...

Galvanized Iron Sheets Taxation: Same Sub-category, No Product Change.

Case Laws     VAT and Sales Tax

August 30, 2024

The issue pertained to the categorization of galvanized iron sheets under the Central Sales Tax (CST) Act and the Andhra Pradesh Value Added Tax (VAT) Act. The Supreme Court in State of Tamil Nadu v. Pyare Lal Malhotra held that a product created from another within the same sub-category cannot be treated as a different commercial product for tax purposes. Entry 70(vi) of the AP VAT Act includes sheets, hoops, strips, and skelp, whether black, galvanized, hot/cold rolled, plain or corrugated, under the same sub-entry. This implies that corrugating plain sheets into corrugated iron sheets does not change the product's category. The Calcutta High Court in Phanindra Nath Manna & Company v. Commercial Tax Officer concurred, stating that galvanized sheets include corrugated and plain sheets, and corrugation does not alter their character as iron sheets. Therefore, the Deputy Commissioner could not have refused deferment of hearing on this issue.

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