The case pertains to the taxability of panel boards purchased by ...

Court Rules Panel Boards & Pumps as Integrated Unit, Avoids Separate Taxation; Contrasts Prior Independent Sales Case.

November 5, 2024

Case Laws     VAT / Sales Tax     HC

The case pertains to the taxability of panel boards purchased by a manufacturer of submersible pumps. The issue was whether panel boards purchased against Form XVII declarations should be taxed separately at a higher rate or as part of an integrated unit with submersible pumps. The court held that since the assessing authority accepted the nature of the final product supplied as an integrated set comprising both the submersible pump and panel board, it is difficult to treat the two items as separate products liable to different tax rates. The court distinguished the present case from the Northwest Switchgear Ltd case, where fan regulators were sold as independent products, and hence classified as parts/accessories attracting higher duty. In the present case, the submersible pumps and panel boards were sold as integrated kits. The court noted that the assessing officer had accepted the concessional rate claim u/s 3(3) for earlier and later years, and there was no justification for deviating from that view for the intervening year alone. The court set aside the impugned Tribunal order and allowed the writ petition.

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