PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:- KGST Act 1963- Clarification under section 59A regarding rate
of tax- M/s.TV,Kaimanan,
Tvpm-orders-issued.
Ref:- Application dt.13..06..2000 from T.V.Sundram Iyengar &
Sons Ltd, Tvpm.
ORDER
No. C5.31996/CT/2000 dt..20..07.2000
I.
M/s. T.V.Sundram Iyengar & Sons Limited, Thiruvananthapuram
filed application under section 59A of the KGST Act seeking clarification
whether-.
(1)
The petitioner would be justified in deducting/adjusting 12 % KGST
paid on the chassis value against KGST due on the sale value of
bus at the time of sale.
(2)
will entry tax be attracted on the body value after construction
of body outside the state the bus is returned to Kerala
(3)
can the petitioner issue C form to body builder in Tamil Nadu for
the construction of bus body.
in respect of the following transaction:
The petitioner purchases chassis from Ashok Leyland RSO, Kerala,
by paying tax at 12 % KGST and send the same to Tamilnadu
for construction of body. After construction of the body on chassis,
the bus will be brought to Kerala and the same would be sold to
customers in Kerala collecting 12 % KGST on the total value of the
bus (chassis value + body value + margin, etc)
2.
Sri. S.Krishnan, Sr. Manager, Accounts, Madurai and Sri. V.Subramaniam,
Manager, Accounts, Thiruvananthapuram appeared and explained the
nature of transaction, which again was as explained above.
3.
As per explanation to entry 94 of the First Schedule to the KGST
Act, where a tax has been levied on chassis of motor vehicle or
on body built on such chassis within the State, the tax payable
on the motor vehicle produced out of such chassis shall be reduced
by the amount of tax paid on such chassis or body built on such
chassis. So in the transaction described above since tax is being
paid in Kerala on chassis and the bus made out of such chassis is
sold in Kerala, the tax paid on chassis in the state is deductible
from the tax payable on the bus.
The first point referred to me is clarified as above.
4.
Under section 59A of the KGST Act the Commissioner can issue clarification
only on matters coming under the KGST Act. In the circumstance I
refuse to issue clarification under section 59A of KGST Act on point
(2) and (3) above.
Sd/
Commissioner
/Approved
for Issue/
Deputy Commissioner
(General)
To
M/s.T.V.Sundram Iyengar & Sons
Thiruvananthapuram
C.C. to Deputy Commissioner, Tvpm
Asst.Commissioner
(Assmt), Tvpm
Registrar, Centre for Taxation Studies Tvpm.
PROCEEDINGS
OF THE COMMISSIONER OF COMMERCIAL TAXES
THIRUVANANTHAPURAM
PRESENT:
SRI. JOHN MATHAI. I.A.S
Sub:-
KGST Act 1963- Clarification under section 59 A-issued
Read:-
Application dated 24..05..2000 from Sunitha Diesel Sales & Service,
Kochi
ORDER
NO. C5-29041/2000/ dt,10..08.2000
M/s.
Sunitha Diesel Sales & Service, Thrippunithura, Kochi sought
clarification regarding the rate of tax applicable to spare parts
of Diesel Engine under the KGST Act 1963.
Sri.V.R.Vamanan, Deputy General Manager (Finance) and Sri.A.Nagarajan,
Asst. Manager (Accounts) appeared on 20..07..2000 and stated that
entry 84 of the first schedule, as substituted by ordinance No.
7/99, did not mention anything about spareparts.
Entry
84 (i) of the first schedule as substituted by the KGST amendment
Act 2000, (8/2000) which is effective from 01..01..2000, reads “Machinery,
internal combustion engine, Marine engine, Diesel engine, Diesel
generating set, their spare parts, ball and roller bearings of all
kinds other than those specifically mentioned in this schedule”.
The rate of tax fixed is 12 %. So spare parts of diesel engine attracts
12 % tax at the point of first sale within the State along with
diesel engine.
The
application is disposed of as above.
Sd/-
Commissioner
/Approved for
Issue/
Deputy Commissioner (General)
To
Sunitha
Diesel Sales & Service.
P.B.No.20.,
Hill
Palace Road
Thripunithura,
Cochin-682 301
C.C
to the Dy. Commissioner, Commercial Taxes, Ekm
The
Registrar, Centre for Taxation Studies, Tvpm
The
Asst. Commissioner (Assmt), Spl.Cir.III,Ekm
PROCEEDINGS
OF THE COMMISSIONER OF COMMERCIAL TAXES
THIRUVANANTHAPURAM
PRESENT:
SRI. JOHN MATHAI. I.A.S
Sub:- K.G.S.T Act, 1963 Rate of tax on Tea sold in auction clarification
U/s.59 A-Issued
Ref:-
Application dt.30.08.2000 from Tea Trade Association,Kochi
ORDER
NO.C5.46004/2000/CT. DT.06.10.00
1.
The Tea Trade Association of Kochi has sought clarification whether
the reduced rate of tax on tea ( 4% on local sales, with effect
from 27..06.2000) and 2 % on interstate sales w.e.f. from 09..06..2000)
would apply to auction of tea conducted prior to the dates of the
respective notification eventhough invoices in respect of such sales
were raised only subsequent to the respective dates.
2.
Sri. Sherifkhan, Secretary appeared and he was heard. He stated
that the sale of tea in auction is controlled by Rules 8,14 and
16(a) of the Rule of the Tea Trade Association. As per Rule 8 an
officer of the bidder shall stand accepted when the auctioneer by
the fall of the hammer and after call over an appropriate sale contract
is confirmed and issued by the broker in the prescribed form for
sale, on local or interstate, whether for export or otherwise, as
the case may be. As per Rule 12 (a) the payment of the completed
sale is to be made within 13 days from the completion of the sale
(Prompt date). If the buyer fails to make the payment on the due
date, Rule 14(a) provides for resale of the tea and the defaulting
buyer is responsible for any loss arising out of such resale and
also liable to pay 1 % interest from the due date till the date
of receipt of the proceeds out of the second sale. Rule 16 (a) further
provides that the goods will be at seller’s risk only till 4.30.P.M
on the 2nd working day after prompt date or until removal
by the buyer, if removed earlier.
3.
It is revealed from the foregoing that the fall of the hammer in
auction decides the rights and liabilities of the parties
to the sale. So necessarily the rate of sales tax applicable to
the tea sold in auction will be the rate prevalent on the date of
auction and not the rate of tax on the date of raising of invoice.
4.
So the reduction in the rate of tax on tea granted as per notification
S.R.O.587/2000 dt.27..06..00 in the case of local sale of tea in
auction and that granted as per notification SRO.517/2000 dt..09..06.00
on the interstate sales of tea would apply only to auctions conducted
on or after the respective dates.
5.
The question referred to me is clarified as above.
Sd/-
COMMISSIONER
/Approved for Issue/
Deputy Commissioner (General)
To
The Secretary
Tea Trade Associations of Cochin
Tea Trade Centre, Indira Gandhi Road,
Kochi. 682 003
C.C.
to
All Dy. Commrs, A.C.(Assmt) Mtty
S.T.O. Spl. Cir (P) Mattancherry
Registrar,C.T.S,
Tvpm
PROCEEDINGS
OF THE COMMISSIONER OF COMMERCIAL TAXES
THIRUVANANTHAPURAM
PRESENT:
SRI. JOHN MATHAI. I.A.S
Sub:-
K.G.S.T.Act 1963-rate of tax on fibre glass boats-clarification
under section 59A- Issued
Ref:-
Application dt.12..06.2000 from Bristol Boats, Aroor
ORDER
NO. C5.31195/2000/CT dt..29.09.2000
Bristol Boats, Aroor has sought clarification on the following points:-
(i)
rate of tax applicable to fibre glass boats.
(ii)
Whether for interstate sales of boats without C form, where the
seller is a small scale industrial unit and the boat is manufactured
by such SSI unit, tax payable is 4 % or 10 % or 12 %.
2.
As per item 3 of the first schedule to SRO.1091/99 the rate of tax
on ships, tugs dredgers and small craft has been reduced to 4 %.
As per Websters Encyclopedic Unambridged Dictionary of the English
Language (New revised Edition), the term “craft” means “ship or
other vessel”. Again the term “vessel” means “a craft for travelling
in water, now usually one larger than an ordinary row boat;- a ship
or Boat”. So it is clear that fibre glass motorised boats of 3 mtrs
to 25 mtrs would be covered by item 3 of the first schedule to SRO.
1091/99. Since Entry 94 of the first schedule to the KGST Act refers
only to motor vessels and the reduction under SRO.1091/99 is from
12 % to 4 % the reduced rate of 4 % will apply only to motor boats.
In the case of rowing boats which are not motorised the rate of
tax will be 8 % under item 177 of the first schedule.
3.
The point No.(i) is therefore clarified accordingly.
4. Under section 59A the Commissioner
can issue clarification only in respect of matters connected with
KGST Act. So I refuse to issue clarification on point (ii) above.
Sd/-
Commissioner
/Approved for Issue/
Deputy Commissioner (General)
To,
Bristol Boats
Aroor Industrial Development Area
Aroor, Alappuzha
Pin. 688 534
C.C to
The Dy.Commissioner,Alappuzha
Asst.Commr(Assmt),STO.Spl.Cir.Alappuzha
Registrar,Centre for Taxation Studies, Thiruvananthapuram
of
internet connection also, providing internet connection does not
even involve any goods and supply of CD is only to have access to
the internet for the first time. This is therefore an integral part
of the services and will not come under the definition of sale.
The transaction of the petitioner will therefore be out of the
purview of the KGST Act.
5. The question referred to me is clarified accordingly.
Sd/-
COMMISSIONER
/Approved for Issue/
Deputy
Commissioner (General)
To.
M/s.Satyam Infoway Limited
Chiramel Chambers
Kurisupally Road
Ravipuram, Kochi
Pin. 682 015
C.C
to
All Dy. Commrs.
Registrar,C.T.S, Tvpm
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:- K.G.S.T.Act,1963- Deep freezer whether attract entry tax-
Clarification u/s.A-rejected orders issued:
Read:- Application dt.01.09.00, M/s.Niulab Equipments Co.Pvt. Ltd,
Chennai
ORDER
NO.C5.46841/2000/CT. DT.20.10.00
M/s. Niulab Equipments Co. Pvt. Ltd, C.10, Thiru-Vi-Ka-Indl.Estate,Guindy,Chennai.32,
has sought clarification whether Deep freezer attracts entry tax
under the Kerala Tax on Entry of Goods into Local Areas Act. 1994.
Under Section .59A of the KGST Act Commissioner can issue clarification
only on matters connected with the KGST Act. Since levy of entry
tax is under the provisions of the Kerala tax on Entry of Goods
into Local Areas Act,1994, I am not empowered under section 59A
of the KGST Act to issue clarification on the question raised.
I therefore refuse to issue clarification in the matter.
Sd/-
Commissioner
/Approved for Issue/
Deputy Commissioner(General)
To,
M/s.Niulab Equipments Co, Pvt.Ltd
C.10,Thiru-Vi-Ka- Indl. Estate
Guindy,Chennai.32.
C.C
to
The Registrar, C.T.S, Tvpm
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:- KGST Act 1963- Entry Tax- whether applicable to Refrigerator
brought into the State and sold U/s. 5.(i) (iii) of the KGST Act-
Clarification under section 59A of the KGST Act-
Ref:- Application dt.26..08..2000 of PEPSICO India Holdings Ltd,Madurai.
ORDER
No. C5.46438/CT/2000 dt.28.10..2000
PEPSICO India holdings Ltd, No.5,N.H.7,Paravac,Madurai North, Tamil
Nadu has filed application Under Section,59A of the KGST Act seeking
clarification whether entry tax under the Kerala Tax on Entry of
Goods into Local Areas Act, 1994 is applicable to refrigerator brought
into the State by the company which is supplied to the distributors
of theis products and tax is paid U/s.5(I) (iii) of the KGST
Act on the transfer of right to use the refrigerator.
Under Section 59 A of the KGST Act Commissioner can issue clarification
only on matters, connected with the KGST Act. Since the point raised
for clarification relates to Kerala Tax on Entry of Goods into Local
Areas Act of 1994, I am not empowered under section 59A of the KGST
Act to issue clarification on the same. I therefore refuse to issue
clarification in the matter.
Sd/-
Commissioner
/Approved for Issue/
Deputy
Commissioner
(General)
To.
M/s.Pepsico India Holdings Ltd.
No.5,N.H.7,Paravai
Madurai.North
Madras.
C.c.
to
All Dy. Commissioners,
S.T.O.2nd Cir, Alappuzha
Registrar,C.T.S, Thiruvananthapuram
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:- K.G.S.T.Act,1963- liability to tax U/s. 5A on the purchase
of raw shell prawns and crustaceans clarification under section
59A- issued
Read:- Application dt.12.10.2000 from Manu Mathew, Ernakulam
ORDER
NO.C5.52149/2000/CT. DT.31.10.00
1.
Sri.Manu Mathew, Kochi sought clarification whether prawn shell
can be said to be consumed in the manufacture of “chittin” which
again is shell of prawns and crustaceans, so as to attract purchase
tax U/s.5A of the KGST Act on the purchase turnover of raw prawn
shell.
2.
Sri.K.A.Prem, Advocate appeared on 12.10.2000 and explained the
process involved as under:-
a)
The shell will first be washed in diluted hydrochloric acid and
water.
b) This will be washed with plain water
c) The shell will be again washed in a mixture of caustic
soda and water
d) This will be washed in plain water then
e) The shell will be dried and sorted by hand using manual labour
to remove any foreign particles other than shell
f) This will be powdered then.
g) No process is done to the shell other than cleaning.
3.
In Sulaiman Vs. State of Kerala (105 STC 324) the Supreme Court
held that a dealer who purchases dry bones and converts them into
bonemeal for sale as such in the market is not liable to pay purchase
tax U/s.5A (1) of the KGST Act, 1963.
The
said decision is squarely applicable to the present case also. The
process mentioned are intended only to clean and dry the raw sell
of prawns and crustaceans. So it cannot be said that a commercial
commodity, different from the prawn shell emerges out of the process
so as to attract levy of purchase tax U/s.5A (1) of the KGST Act
in respect of the purchase of raw shell of prawns and crustaceans.
4.
The point referred to me is clarified accordingly.
Sd/
COMMISSIONER
/Approved for Issue/
Deputy Commissioner
(General)
To
Sri. Manu Mathew
Kochi
Through Sri.K.A.PREM,Advacate
M/s.O.R.Chummar & Co.
Broadway, Ekm,682 031
C.C
to
All Deputy Commissioners
Registrar, CTS, Thiruvananthapuram
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:-
KGST Act. 1963- Rate of tax on Bedsheet, Pillowcover, Towels, Napkins
and Mosquito Net clarification under section 59A issued.
Read:-
Application dt.04..07..2000 from Tamil Nadu Handloom weavers Co-operative
Society Ltd, Ernakulam.
ORDER
NO.C5. 37354/00/CT DT...03..11.00
1.
The Tamil Nadu Handloom weaver’s Co-operative society Ltd, Ernakulam
has sought clarification regarding the taxability or otherwise of
the following items produced by handloom.
1.
Bedsheet
2.
Pillow cover
3. Towels
4. Napkin
5.
Mosquito net
2.
Sri. S.Gangadharan Nair, Manager, S.P. Thiruvananthapuram, duly
authorised,appeared on 21..10..2000 and was heard. As per item
27 of the 3rd schedule to the KGST Act,handloom cloth
and Handloom readymade garments are exempted from tax. So Bedsheet
and towels made of handloom will be covered by this entry. Again
as per notification SRO.440/00 Bed sheets, Pillow Cover and towels
have been exempted from tax. Napkin cannot be said to be handloom
cloth. So napkins will fall under entry 120 of the first schedule
to the KGST Act, attracting tax @ 8%. Mosquito net (stitched) does
not fall under any specific entry. So it will fall under entry 177
of the 1st schedule to the KGST Act attracting tax @
8 %.
6.
The question referred to me is clarified as above.
Sd/
COMMISSIONER
/Approved
for Issue/
Deputy Commissioner(General)
To,
The Regional Manager
Co-optex Regional Office
Kenson Building
Shanmugham Road,Kochi. 682 031
C.C to
All DY.Commrs
Registrar,CTS,Tvpm
STO.2nd Cir, Kozhikode
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:-
KGST Act. 1963- Liability to tax under section 5 (2) of the KGST
Act clarification under section 59A-issued.
Read:-
Application dt.20.09.2000 from J.N.B. Marketing (India) Ltd., Ernakulam.
ORDER NO.C5. 47192/00/CT DT.10.11..00
M/s.J.N.B.Marketing (India) Ltd, Ernakulam has sought clarification
whether they, who hold brand name “Mrs. Kerala” for pressure cooker
and “metafa” for metal guard non-stick cookware, will be liable
to tax under sub-section (2) of section 5 of the KGST Act under
the following circumstances:
2. These products are manufactured by M/s.Kaviraj Appliances
(P) Ltd., at Bangalore and the same is transferred to the manufacturers
sales depot at Ernakulam which is registered with Sales Tax Office,
II Circle, Ernakulam. Thereafter these goods are supplied to the
applicant invoice of the manufacturers charging the sales tax claming
as first seller in the State. The applicant distributes the products
in the State of Kerala among the retail dealers claiming as second
sellers. These products are listed against entry No.116 of first
schedule. J.N.B.Marketing (India) Ltd has applied for registration
of brand name. It will take about 3 to 5 years to get the trade
mark registered.
3. Sri.P.P.Raghavan Nambiar, Sales Tax Practitioner and authorised
representative appeared and he was heard. He put-up the following
contentions:
4. According to the section 5 (2) , the sale by the brand name
holder or the trade mark holder within the State shall be the first
sale for the purpose of assessment to tax. The expression “manufactured
goods” given in Sub-section (2) related to the goods manufactured
in Kerala only and in that case the liability to tax shifting first
sale on the brand name holder or trade mark holder is applicable
only in the case of goods manufactured in this State (Kerala). Applying
the above ratio the applicant can only be 2nd dealers
and the Ist point tax is exigible only onto the Depot of the manufacturers
at Ernakulam .
5. Sub-section (2) of section 5 of the KGST Act, as inserted by
the Finance Act ’98 reads:-
“(2) Notwithstanding anything contained in this Act, in respect
of manufactured goods other than tea, which are sold under a trade
mark or brand name, the sale by the brand name holder or the trade
mark holder within the State shall be the first sale for the purposes
of this Act”.
The sub-section does not restrict its operation to goods manufactured
within the state of Kerala. Irrespective of the place of manufacture
the goods will be liable to tax at the hands of the Brand name holders.
The sub-section does not stipulate that the brand name/ trade mark
should be one regd under the Trade and Merchandise Marks Act. It
is admitted by the applicant that the Brand names mentioned above
are exclusively used by it.
6. Eventhough the Brand name is affixed at the place of manufacture,
the manufacturer does not have the right to effect sales of the
goods with brand name to any body other than the brand name holder.
As such the sale by the applicant is the sale by the brand name
holder within the State and will clearly fall under sub-section
(2) of Section 5 and liable to tax.
7. The points referred to me is clarified as above.
Sd/
COMMISSIONER
/Approved for Issue/
Deputy Commissioner (General)
To.
M/s.J.N.B Marketing (India) Ltd.
Omana Buildings
Jews Street,Ernakulam
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:-
KGST Act. 1963- Diesel Oil whether covered by section 5(3) of the
KGST Act- clarification under section 59A- issued.
Read:-
Application dt.01..08..2000from Foster Foods (Pvt) Ltd, Trissur
ORDER NO.C5. 40824/00/CT D.28..10..00
1.
M/s.Foster Foods Pvt. Ltd, Trissur has sought clarification that
Diesel Oil will be covered by section 5 (3) of the KGST Act so
that the applicant can make purchases at concessional rate of 3
% against form 18 for use in connection with the manufacture of
goods by it.
2.
Sri. Boban Kollannur, Chairman and Managing Director appeared on
21..10..00 and he was heard. According to him Govt . of India have
clarified that Diesel Oil will fall under “fuel” for the purposes
of Section 8 (3) (b) of the CST Act and that should equally apply
to section 5 (3) of the KGST Act.
3.
Section 8 (3) (b) of the CST Act refers to goods which a registered
dealer can buy at concessional rate of CST using `C’ form. They
are-
“Goods of the class or classes specified in the certificate of registration
of the registered dealer purchasing the goods as being intended
for resale by him or subject to any rules made by the central government
in this behalf, for use by him in the manufacture or processing
of goods for sale..”
4.
The wording in section 5 (3) of the KGST Act are materially different,
viz “(3) notwithstanding anything contained in sub-section (1),
the tax payable by a dealer in respect of any sale of industrial
raw materials, component parts, containers or packing materials………….
when
sold to industrial units for use in the production of finished products
inside the state for sale………..”
5.
Wheras under the CST Act, the facility of `C’ form will be available
for the purchase of any material which is used in the manufacture
or processing of goods for sale, section 5 (3) of the KGST Act is
applicable only to industrial raw material, component parts or packing
material. Raw material has been held to include only those goods
which go into the finished products. Since Diesel Oil does not go
into the finished product, viz Biscuit, it cannot be said to fall
under the definition of “raw material”
6.Hence
“Diesel Oil” will not fall under the definition of the term “raw
material” used in section 5(3) of the KGST Act.
7.
The clarification sought is answered accordingly.
Sd/
COMMISSIONER
/Approved for Issue/
Deputy Commissioner(General)
To.
FOSTER FOODS (P) LTD
Varadiam, Trissur. 680 547
C.C.
to
All Dy.Commissioners
Asst.Commr.(Assmt),Trissur
Inspg.Asst.Commr, Trissur
Sales Tax officer,2nd Cir, Trissur
Registrar, C.T.S, Thiruvananthapuram
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:-
KGST Act. 1963- Transport of goods covered by sale bills along
with goods covered by permit under section 15-collection of security
deposit under section 29A (2) legality clarification U/s.59A-issued.
Read:-
Application dt.28..07...2000 from Uthradam Agencies, Kollam
ORDER NO.C5. 38959/00/CT DT..02..11..00
1.
M/s.Uthradam Agencies Kollam has sought clarification on the following
points:
(i)
Whether the goods being despatched in a vehicle for door delivery
on the strength of sale bills will come under concluded sales.
(ii)
Whether the goods covered by valid permit and documents required
to be carried can be transported along with other goods which are
supported by valid sale bills/Delivery note.
2.
Sri.H.Sivasubramony, Accountant appeared on 02..09..2000. The transaction
was explained by the authorised representative as follows:-
3.
For van sales the applicant keeps proper records under section 15
of the KGST Act read with revevant rules. In addition to the goods
covered under the permit, goods sold to various parties, in case
of which sale had already been concluded in the shop itself and
which are covered by proper sale bills, are also carried in the
same vehicle for door delivery.
4.
Section 15 of the KGST Act read with Rule 7 of the KGST Rules required
maintenance of a stock register along with the sale bill or purchase
bill as the case may be in respect of goods covered by the permit.
Under Section 29(2) of the KGST Act goods exceeding the prescribed
value shall be accompanied by either a sale bill, delivery note
or certificate of ownership. There is no specific prohibition that
along with goods covered by a permit under section 15 a dealer should
not carry goods already sold.
5.
So if the goods are covered by proper records as prescribed under
section 15 of the KGST Act read with Rule 7 of the KGST Rules or
under section 29(2) of the KGST Act and if there are no reasons
to suspect the bonafides of the documents, collection of security
deposit under section 29A would be illegal.
6.
The points referred to me are clarified as above.
COMMISSIONER
/Approved for Issue/
Deputy Commissioner (General)
To.
M/s.Uthradam Agencies
P.B.No. 30, Main Road
Kollam-1
C.C.
to
All Dy. Commissioner
Registrar,C.T.S, Thiruvananthapuram
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:-
KGST Act. 1963- Rate of tax on plates & film with chemical
coating used in mini offset machine -clarification under section
59A- issued.
Read:-
Application dt. 01.06.2000 from Mihir Dyechem Pvt. Ltd, Ernakulam
ORDER
NO.C5. 28633/00/CT DT.02.11.00
1.
Mihir Dyechem Private Limited has sought clarification regarding
the rate of tax applicable to plate and film with chemical coiling
used in mini offset machine Shri. M.B.Damodharan, Zonel Sales Manager,
Technova Imaging System Private Limited, the manufacturers, and
Sri. Viswananthan, Manager, Mihir Dye Chem private Limited appeared
and they were heard. They also produced invoice issued by Technova
Imaging Systems Limited. Mumbai, the manufacturers.
2.
As per the invoice the item is presensitised aluminum litho plates
falling under chapter No. 8442.90 of the Central excise Tariff Heading
No.84.42 of the Central Excise Tariff reads “Machinery, apparatus
and equipment (other than the machine tools of heading Nos. 84.56
to 84.65) for type founding or type setting or preparing for making
printing blocks, platesm cylinders or other components, printing
type blocks plates, cylinders and other printing components, block
plates, cylinders and lithographic stones prepared for printing
purposes. ( for example plained, grained or polished). The literature
produced by the applicant shows the description of the products
as a polyester based film for direct imaging on laser printer to
produce economic film positive (or negatives) for offset plate making
or screne printing.
3.
It is also seen from the literature that the product is made of
diamentionally stable polyester
4.
Entry 113 of the first schedule to the KGST Act reads “plastic and
articles of plastic including PVC pipes, plastic paper, cellophane,
polythene, polyurethane, polyester, whether expanded or not, polystyrene,
formated sheet, sun control polyster film, polyster tracing and
film polyster, self adhesive insulation tape, fibre reinforced plastic
not coming under any other entry in this schedule or in the 5th
schedule”, which attract tax @ 12 % at the point of first sale
within the state.
5.
From the description given above the item can be classified only
under entry 113.
6.
The point is clarified accordingly.
COMMISSIONER
/Approved for Issue/
Deputy Commissioner (General)
To.
Mihir Dye Chem (P) Ltd.
39/756,Kachappally Chambers
1st Floor, Mahakavi G. Road
Kochi. 682 011
C.C to
All Dy.Commissioners
Inspg.Asst.Commr, Ekm
STO. Ekm
Registrat, CTS, Tvpm
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:-
KGST Act. 1963-Clarification under section 59A of the KGST Act-
Application of SRO. 404/94 on a unit manufacturing bakery biscuits
prior to 01..04..94 -orders issued.
Read:-
Application dt.08.08.2000 from M/s. Palma Breads and Pastries,
Olavakode,Palakkad.
ORDER
NO.C5. 42577/00/CT DT.06.11.00
1. M/s.Palma Breads and Pastries, 35/432, Main Road, Olavakode,
Palakkad-678 002 has sought clarification under section 59A of the
KGST Act whether S.R.O. 404/94 is applicable to a unit manufacturing
bakery biscuits which is mainly a bread manufacturing unit which
manufactures biscuits as an incidental activity .They have also
raised doubt whether sales tax exemption already conferred on an
entirely biscuit manufacturing unit prior to 01..04..94 under
notification 1729/93 can be denied to such unit w.e.f. 01..04..94
on the basis of SRO. 404/94 and also whether the application of
the SRO is only for new biscuit manufacturing units set up on or
after 01..04..94.
2. Sri.M.S.Ramachandran, C.A. Palakkad,
authorised representative, appeared and he was heard. He contended
that SRO. 404/94 can’t be applied to industrial units which had
commenced production prior to 1..04..1994. Since the applicant unit
commenced production in 1993 it will be eligible for exemption subsequent
to 01..04..1994 also. He also pleaded that SRO. 550/2000 will apply
to manufacturing units even if their main activity is manufacture
of Bread.
3. At the time of hearing it has been
pointed out that the assessment in this case has already been completed
and the matter is now pending before the Appellate Tribunal.
4. Under section 59A of the KGST Act
commissioner can not issue clarification if assessment has already
been completed, in which case, the petitioner has to pursue the
appeal pending before the tribunal.
5. In the circumstances above I am
not empowered under section 59A of the KGST Act to issue clarification
on the question raised, I refuse to issue clarification in the
matter and accordingly.
Sd/-
COMMISSIONER
/Approved for Issue/
To.
Deputy Commissioner (General)
M/s. Palma Breads and Pastries
35/432, Main Road
Olavakode
Palakkad. 678 002
C.C
to
All Dy. Commissioner
Registrar, CTS, Thiruvananthapuram
STO.2nd Cir. Palakkad
Registrat, CTS, Tvpm
PROCEEDINGS OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:-
KGST Act. 1963- JCB Imported tracked excavators running on chain
whether motor vehicle liable to entry tax- Clarification Under section
59A-Reg:-
Read:-
Application dt.23..06..2000. from M/s. India Tech Ltd, Kowdiar,
Thiruvananthapuram.
ORDER
NO.C5. 33021/00/CT DT.23.11..00
1.
India Techs Limited . Kowdiar, Thiruvananthapuram has sought clarification
whether Escods JCB imported tracked Excavator which does not run
on wheels but on a chair and cannot also run on public roads, would
attract entry tax.
2.
But under Section 59A of the KGST Act the Commissioner can clarify
only matters connected with KGST Act. In the circumstance I refuse
to issue clarification as prayed for
Sd/-
Commissioner
/Approved for Issue/
Deputy Commissioner (General)
To,
M/s.INDIA TECHS LIMITED
Kowdiar,
Thiruvananthapuram
C.C
to
Dy. Commissioner,Tvpm
Registrar, C.T.S, Tvpm
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present
: Sri. JOHN MATHAI. I.A.S
Sub:-
KGST Act- tax liability of metal crushing unit- Payyavoor Crushers-
Clarification U/s. 59A -orders issued
Ref:-
Application dt.03.08.00 from Payyavoor Crushers, Kannur
ORDER
NO. C5.42334/00/CT dt..13..12..00
The applicant, M/s. Payyavoor Crushers, Kannur is a metal crushing
unit producing granite metal using three machines of 40.64 cm x
22.86 cm, There is a primary crusher of 76.20 cm x 38.10 cm size.
The unit converts boulders into soling stone through the primary
crusher which is passed on to the secondary crusher which brings
out the end product viz granite metal.
2. The unit has sought clarification whether the primary crusher
which producers only the in-between work in process raw material
is to be reckoned for composition under section 7 (1) (b) of the
KGST Act or whether it is enough if the secondary crusher size alone
is reckoned for such purpose.
3. Sri.K.J.Mathai, Authorised representative appeared and he was
heard. He argued that the granite blocks coming out of the primary
crusher, which will be of 4 to 8” in size, is not saleable and can
be fed only to secondary crusher. He further argued that the statute
envisages reckoning only the secondary crusher for the purpose of
fixing the compounded tax since in section 7 (1) (b) emphasis is
on production of granite metals and not soling stone.
4. Section 7 (1) (b) of the KGST Act reads:
(1)
Notwithstanding anything contained in Sub-section (1) of Section
5-
xx
xx xx xx
“(b) any mechanised crushing unit producing granite metals may,
at its option, instead of paying tax in accordance with the provisions
of that sub-section, pay tax at the following rates, namely:-
(i) for each crushing machine of size not
exceeding 30.48 cm x 22.86 cm Rs.15000
/per annam
(ii) for each crushing machine of size
exceeding 30.48 cm x 22.86 cm but not
exceeding 40.64 cm x 22.56 cm Rs.30000/per
annam
(iii) for each crushing machine of size
exceeding 40.64 cm x 22.86 cm Rs.60000/
per annam
5. The tax under section 7 is in lieu of the tax payable under
section 5 (1) of the KGST Act
Section
5 (1) of the KGST Act reads:
“(1) Every dealer other than a casual trader or agent of a non-resident
dealer) whose total turnover for a year is not less than two Lakhs
rupees and every casual trader or agent of a non-resident dealer,
whatever be his total turnover for year, shall pay tax on his taxable
turnover for that year-
(i)
in the case of goods specified in the First or Second Schedule at
the rates and only at the points specified against such goods in
the said Schedule……………”
6. So it can be seen that what is contemplated under section
7 (1) (b) of the KGST Act is that in respect of those who are liable
to pay sales tax on the granite metals produced by them is given
an option to pay compounded tax on the basis of the capacity of
the machine which produces the metal sold. So when a unit sells
granite metals coming out of a particular machine size, his compounded
tax will depend on the size of the machine which produces the final
product. If a unit produces granite metals of different sizes, the
respective machines will have to be taken into account for the purpose
of composition
7. The process involved in a unit with a primary crusher has
been ascertained. The large boulders fed into the primary crusher
is converted into smaller stones called soling stone which is directly
fed to the secondary crushers generally through conveyor belts for
making granite. There is no chance of the primary crushers giving
any output directly for sale..
8. So in the case of the petitioner, if it sells only the granite
metals coming out of the secondary crushers, the secondary crushers
alone will have to be reckoned for the purpose of computation of
compounded tax.
9. The question referred to me is clarified accordingly.
Sd/-
COMMISSIONER
/Approved for Issue/
DeputyCommissioner (General)
To,
M/s.
Payyavoor Crushers
Payyavoor.P.O
Pin 670 633
Kannur Dist.
C.C
to
All Dy. Commissioners
Registrar, C.T.S, Thiruvananthapuram
S.T.O., Thaliparamba
File/ Stock File
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present : Sri. VINOD RAI. I.A.S
Sub:-
Rate of tax on different types of PVC insulated cables-Regarding.
Ref:-Application
dated 30..08..2000 from Finolex Cables Limited, Ernakulam.
ORDER
NO. C5.46872/00/CT dt.. 05.01..2001
Finolex Cables Limited has sought clarification regarding the rates
of tax applicable to the following items of PVC insulated cables:
1.
Electrical wire as per IS. 898
2.
Flexible and multi core cables as per IS. 898
3.
Power cables as per IS.1554
4.
3 core flat cables and winding wire with PVC insulation.
5.
Co-axial cable for cable TV Net work
6.
Automobiles cables and auto battery cables.
7.
Computer net work LAN cable.
8.
Telephone and switch board cables.
9.
Jelly filled telephone cables
10.
Optic fibre cables
11. Component and accessories for computer net work-structured
cable system.
2. Sri.V.JoythisKumar, Senior Sales Manager, Finolex Cables and
Shri. Ajith, Senior Sales Engineer (Finolex cables) appeared and
they were heard. According to them item (1) can be classified as
wiring cables.
Item (2) is a flexible and multicore cable, which can be used for
industrial wiring. But main use is in industrial control. They are
also used inside machines. Item (3) according to them cannot be
considered as wiring cables since it is used for heavy power transmission
for underground purposes only. Wiring cables, according to them,
are those which are used for wiring a building and such wires cannot
be used outside the building. Item (4): 3 core flat cables are used
for winding of submersible pumps connection. Normal insulated winding
wire is for winding motors. Item (5), Co-axial cable for cable TV
Net work, can be used only for communication purpose since it contains
only one copper conductor which is meant for data transmission and
second one is aluminum beeding which is for shielding purpose whereas
in the case of electrical wire minimum 2 copper conductors will
be required. Item (6), Automobile cable and Auto battery cables
are meant for carrying low voltage current and can be used only
in automobile wiring. According to them it cannot therefore be called
wiring cable. Item (7), Computer net work LAN cables are used for
connecting computers and can be used only for data transmission.
Item (8), Telephone and Switch Board cables and item (9), Jelly
filled telephone cables are used only for Telecommunication purpose.
Item (10), optic fibre cables are also used only for communication
purpose and cannot be used for carrying current.
3. As per Sl.No. 54 of the first schedule to the KGST Act Electrical
goods, Electrical appliances and Electrical wiring cables ACSR conductors
attract tax at the following rates:-
1. Electrical goods 8 %
2. Electrical appliances (Fan,grinders,mixtures, cooking ranges,
water heater ) (12%)
3. Electrical wiring cables and ACSR conductors (12 %)
4(a). As far as electrical wiring cables are concerned it is not
specified whether house wiring cables alone will be covered by the
entry. So wires used for industrial wiring will also be covered
by the entry. So items 1 and 2 will clearly fall under entry 54
(iii) of the first schedule taxable @ 12 %.
(b) Item (3), power cables as per IS. 1554 is used for heavy power
transmission for underground purposes. ACSR Conductors mentioned
in entry 54 (iii) of the first schedule will cover only. Aluminum
conductors used for 11 KV lines and will not cover underground cables.
So power cables as per IS. 1554 can be classified neither as electrical
wiring cables nor as ACSR Conductors. It can therefore be classified
only as electrical goods falling under entry 54(I) taxable @ 8 %.
© Item (4), “3 core flat cables and winding wire with PVC insulation”
3 core flat cables are used for submersible pump winding and connections.
Winding wire with PVC insulation are used only for winding motors.
They can therefore be classified only as electrical goods falling
under entry 54(i) of the first schedule taxable at 8 %.
(d) Item (5) Co-axial cable for TV net work and item (7) “computer
network LAN cables” and item (11) “components and accessories for
computer net work structured cable system”: They can be classified
only under electronic goods, falling under entry 55 of the First
Schedule liable to tax @ 8 %.
(e) Item 6. Automobile cables and Auto battery cables will squarely
fall under item 135 of the first schedule, namely, “spare parts
and accessories of motor vehicles etc” taxable @ 8 %.
(f) Item 8. “Telephone and Switch board cables”, Item 9: “Jelly
filled telephone cable” and Item 10 “optic fibre cables” will fall
under “Telecommunication apparatus not falling under any other entry
in the schedule”, vide entry 152 of the first schedule taxable at
8 %.
5. The questions referred to me are clarified as above under section
59 A 0f the KGST Act.
Sd/-
Commissioner
/Approved for Issue/
Deputy Commissioner (General)
To,
M/s.Finolex Cables Ltd.
49/195-A-1,Puthukalavattom
Road
Elamakkara,
Ernakulam.26
C.c to
All Deputy Commissioner
Registrar, C.T.S, Tvpm
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present : Sri. VINOD RAI. I.A.S
Sub:
K.G.S.T Act, 1963- rate of tax on plywood, mica, Hard board etc
held as opening
stock on 01..04..97- clarification under section 59A- orders- issued-
Ref:-Application
dt..10..12..2000 from Sri.S.Baiju, City Glass Traders, Thiruvananthapuram
ORDER NO. C5.62772/00/CT dt.. 08 .01..2001
Sri.S.Baiju, City Glass Traders, P.H.Road, Thiruvananthapuram has
sought clarification regarding the rate of tax to be charged on
the sales of plywood, mica, hardboard, which were purchased from
registered dealers within the state after paying tax during the
year 1996-97 when the sales are effected by the applicant after
01..04..97.
2. Sri. S.Baiju, Proprietor appeared along with Sri. S.Gopinath,
authorised representative and they were heard. They argued that
since the goods have already suffered tax at the point of sale effected
by the registered dealers within the State, to the applicant, rate
of tax applicable to the last sale within the State alone can be
levied when the applicant sells the goods to consumers within the
State. Upto 31.03..97 plywood, mica, hardboard etc were classified
under the sixth schedule to the K.G.S.T Act on which tax was leviable
under section 5 (I) (vi) of the K.G.S.T Act. (ie. Value added tax
was levied on such goods).:
3. Section 5 (I) (vi) of the K.G.S.T Act, as it stood as on 31..03..97
read:
“5. Levy of tax on sale or purchase of goods: (I) Every dealer
(Other than a casual trader or agent of a non-resident dealer) whose
total turnover for a year is not less than two Lakhs rupees and
every casual trader or agent of a non-resident, whatever be his
total turnover for the year, shall pay tax on his taxable turnover
for that year-
xxx xxx xxx xxx
xxx
(vi) in the case of goods specified in the sixth schedule, at the
rate specified in the said schedule at all points of sale in the
State:
Provided that no tax shall be payable on that part of the turnover
on which tax has already been levied on the preceeding sales in
the state.
xxx xxx xxx xxx
xxx “
From 01..04..97, clause (vi) of sub-section (1) of Section 5 and
sixth schedule to the Act were omitted and all goods those fell
under the sixth schedule prior to 01..04..97 were included under
the fifth schedule to the Act, taxable at two points of sales within
the State, viz first sale and last sale within the State under Section
5 (I) (vi) of the K.G.S.T Act.
4. Sub-section (2) and (3) of Sections 59 of the Act deals with
situations where goods taxable at all point of sale are included
in the first schedule and also where the point of levy is changed
from the point of first purchase in the State. The Sub-sections
read:
“(2) Notwithstanding anything contained in this Act, where goods,
the sale of which is liable to tax at all points of sale, are included
in the First Schedule, the first sale of such goods effected within
the State after such inclusion shall be deemed to be the first sale
in the State for the purposes of this Act although any sale of such
goods has taken place within the State before such inclusion.
(3) Notwithstanding anything contained in this Act, where the point
of levy of tax in respect of any goods is changed from the point
of first sale to the point of first purchase in the State, the value
of such goods held in stock by any person on the date of such change
of the point of levy of tax and for which tax at the point of first
sale in the State has not been levied, shall be deemed to be the
taxable turnover in respect of such goods at the point of first
purchase under this Act.” Situation where goods are transferred
from the VAT system to the double point system is not specifically
dealt with in section 59.
5. The general rule of interpretation of fiscal statutes is that
the provisions should be interpreted strictly and in case of any
ambiguity the interpretation which is beneficial to the subject
should be adopted. Under sub-section (3) of section 59, tax is
leviable on goods, the point of levy in respect of which is changed
to the point of first purchase, only if the goods had not suffered
tax at the point of first sale in the State. Interpreted in the
light of sub-section (3), if the goods had sufferred tax on the
sale of any goods while it was included in the sixth schedule to
the Act (VAT System) prior to 01..04..97, the subsequent sale of
such goods cannot be treated as first sale within the State. So
the rate applicable to the first sale cannot be applied to the sale
effected on or after 01.04.97, under section. 5(1) (v) of the KGST
Act, of goods which had suffered tax within the state under section
5 (1) (vi) prior to 01..04..97. But the last sale of such goods
will attract tax at the appropriate rate given in column (6) of
the fifth schedule (ie. The rate applicable to the last sale within
the state)
6. The question referred to me for clarification is answered as
above under section 59A of the KGST Act.
Sd/
Commissioner
/Approved for Issue/
Deputy Commissioner(General)
To
Sri.S.Baiju,
City Glass Traders,
Thiruvananthapuram.
C.C
to
All Deputy Commissioner
Registrar, C.T.S, Tvpm
Asst.Commr, (Assmt), Tvpm
PROCEEDINGS
OF THE COMMISSIONER, COMMERCIAL TAXES,
THIRUVANANTHAPURAM
Present : Sri. VINOD RAI. I.A.S
Sub:-
KGST Act, 1963- rate of tax on patient care equipments made of
Iron and steel-
clarification U/s.59A- reg:-
Ref:-
Application dt.10..10..2000 from M/s.METALBEDS INDIA, Trissur- |