Bombay High Court
Ricoh India Limited vs The State Of Maharashtra And Anr on 20 December, 2018
Equivalent citations: AIRONLINE 2018 BOM 1346
Author: S. C. Dharmadhikari
Bench: S. C. Dharmadhikari, B. P. Colabawalla
Judgment-MVXA.16.2018.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
MAHARASHTRA VALUE ADDED TAX APPEAL NO. 16 OF 2018
Ricoh India Limited }
a company registered under }
the Companies Act, 1956 }
having its registered office at }
801, 8 th floor, Ackruti Star, }
MIDC Central Road, Near }
Marol Telephone Exchange, }
MIDC, Andheri (East), }
Mumbai-400 093 } Appellant
versus
1. The State of Maharashtra }
through the Government }
Pleader, High Court, Mumbai }
}
2. The Commissioner of State }
Tax, having his office at GST }
Bhavan, Mazgaon, }
Mumbai-400 010 } Respondents
Mr.V. Sridharan-Senior Advocate with
Mr.Prakash Shah, Mr. Jas Sanghavi and
Mr. Viraj Y. Bhate I/b. M/s. PDS Legal for
the petitioner.
Ms.Jyoti Chavan-AGP for the respondents.
CORAM :- S. C. DHARMADHIKARI &
B. P. COLABAWALLA, JJ.
Reserved on 18 th September, 2018 Pronounced on 20 th December, 2018 Page 1 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:12 ::: Judgment-MVXA.16.2018.doc Judgment :- (Per S. C. Dharmadhikari, J.)
1. This appeal by the appellant-dealer challenges the order passed on 26th September, 2017 by the Maharashtra Sales Tax Tribunal (hereinafter referred to as "the MSTT") in Value Added Tax Appeal No. 13 of 2012.
2. The appellant is a company registered under the Indian Companies Act, 1956, whereas the respondents before us are the State of Maharashtra and the Commissioner of Sales Tax who is also exercising the powers under the Maharashtra Value Added Tax Act, 2002 (hereinafter referred to as "the MVAT Act").
3. The appeal raises the following substantial questions of law:-
"(a) Whether multi function printers are classifiable under Entry 84.71 of the Notification No. VAT-1505/CR-
116/Taxation-1 dated 1st April, 2005 (issued under Entry C- 56 of the Maharashtra Value Added Tax Act, 2002) as "input units" or "output units"?
(b) Whether multi function printers are classifiable under Entry 84.71 of the Notification No. VAT-1505/CR- 116/Taxation-1 dated 1st April, 2005 (issued under Entry C- 56 of the Maharashtra Value Added Tax Act, 2002) as "automatic data processing machine" or units thereof or as other units of automatic data processing machine?
(c) Whether multi function printers are classifiable under Entry 84.71 of the Notification No. VAT-1505/CR- 116/Taxation-1 dated 1st April, 2005 (issued under Entry C- 56 of the Maharashtra Value Added Tax Act, 2002) as "laser jet printers?
(e) Whether the parts, spares, drums etc. of Multi function printers are classifiable under Entry 84.73 of the Notification No. VAT-1505/CR-116/Taxation-1 dated 1st April, 2005 (issued under Entry C-56 of the Maharashtra Value Added Tax Act, 2002)?"
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4. At the outset, the appellant proposes six questions as substantial questions of law, but Mr. Sridharan learned senior counsel appearing in support of this appeal states, on instructions, that the appellant is not pressing the questions proposed as (d) and (f) at page 8 of the paper book.
5. Hence, the appeal is admitted on the above reproduced substantial questions of law.
6. In the light of the limited issue involved, calling of records and proceedings and the filing of paper book is dispensed with. By consent of both sides, this appeal is disposed of finally.
7. The appellant is, inter alia, engaged in the business of importing and selling the electronic and Information Technology (IT) products such as printers, computers, projectors etc. It is a registered dealer under the MVAT Act. With an intention of obtaining clarity with regard to the rates of tax applicable to the goods sold by the appellant in Maharashtra, it made an application dated 14th July, 2005 under section 56 of the MVAT Act for determination of the disputed question (DDQ). This DDQ application was preferred before the second respondent. Exhibit 'B' is a copy of this DDQ application.Page 3 of 41
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8. The appellant forwarded details of some transactions and particularly those on which an opinion of the Commissioner was sought by it. These transactions are as follows:-
i. rate of tax applicable on the sale and leas ing of Multi-Function Printers;
ii. rate of tax applicable on the sale of Spares, Drums, Toners, Developers of the said Multi-Function Printers;
iii. Inclusion of the refundable security deposit in the value upon which sales tax is payable on the leasing of Multi- Functions Printers.
9. The appellant also forwarded copies of the invoice dated 11th July, 2005 pertaining to the sale of multi-functional printers and another invoice of the same date pertaining to sale of parts, accessories, drums etc. of these multi-functional printers. A copy of the agreement dated 11th July, 2005 pertaining to sale of multi- functional printers was also relied upon.
10. On these materials, the second respondent passed an order on 12th December, 2011 holding that the rate of tax applicable on the sale/lease of the multi-functional printers would be 12.5% as opposed to 4% claimed by the appellant. He also determined the rate in terms of Schedule Entry C-56 on parts, drums etc. This was also determined at 12.5%. The second respondent held that the refundable security deposit taken by the appellant from the customers at the time of leasing of multi-functional printers Page 4 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:12 ::: Judgment-MVXA.16.2018.doc would be includible in the sale price for the purpose of discharging the liability to pay MVAT. A copy of this order is at Exhibit 'E' to the petition.
11. Being aggrieved by the order dated 12th December, 2011, the appellant moved an appeal before the MSTT being VAT Appeal No.30 of 2012. The MSTT, by its order dated 26th September, 2017 upheld the DDQ Order dated 12 th December, 2011. The appellant thereafter filed a Rectification Application No.77 of 2012, which was dismissed by the MSTT on 9th January, 2018.
12. The claim of the appellant is that the products in question are essentially printers. They are capable of accepting and processing data in a wide range of operating systems and application programs of receiving data input from multiple sources and of printing data output on a self-contained printing unit. The other functions are that multi-functional printers incorporate significant data processing features (such as an internet web page from which the printers can be programmed and operated from remote locations over a computer network), electronic mail (e-mail) management services, data storage and a wide array of other digital data processing functions. The multi- functional printers can also function as an independent, standalone device, or may be connected with other such machines Page 5 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:12 ::: Judgment-MVXA.16.2018.doc and units in local or wide area networks (LAN/WAN). The heart of the multi-functional printers is a high-power, freely programmable central processing unit (CPU) which organizes and conducts the data processing functions of this multi-functional printer. The CPU is also capable of running a number of administration protocols. The multi-functional printer also features a standard hard drive. The multi-functional printer contains an output unit in the form of an electrostatic digital printer. It is capable of sensing numerous paper sizes and of handling a wide range of print media. The multi-functional printer also allows up to seven different settings that a user may program to accept custom media. The printer unit can accept digital data files either from the multi-functional machine's own central processing unit or from one or more computers connected to the data processing network on which the multifunctional printer resides. Also included within the same housing is an integrated input unit in the form of a high speed optical scanner. The scanner features a device which reads the document to be scanned. The scanner converts the scanned data into a digital document. The device can scan to file storage or to an internal network server or to external network servers or to an email box. In addition to the above components, a multi-functional printer also has an optional one or two-line facsimile modem. Thus, the Page 6 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:12 ::: Judgment-MVXA.16.2018.doc multi-functional printer incorporates in a single housing a freely programmable CPU, an automatic data processing digital output unit and an automatic data processing digital input unit. To summarize, the multi-functional printers are modular units which connect to the computer/computer network and are used in automation activity of printing. The heart of the multi-functional printer consists of a printing mechanism to perform the basic function of printing. In addition to the primary function of printing, other incidental functions performed by multi-functional printers are scanning and copying or scanning, copying and fax. However, the essential function of the product is nothing but printing. This is quite evident from the fact that all of the above functions involve printing except in the case of scanning. In the case of copying and faxing the output, which is the document received as fax or the document which is to be copied, is printed using the same cartridge which is used for printing a document from the computer. Therefore, if the printer cartridge is removed then only scanning alone can be done.
13. In conclusion, a multi-functional printer is sold and marketed as a printer with additional capacities such as copying, fax and scanning. Any person, while making a purchase of this article, understands it to be a printer with some incidental and Page 7 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:12 ::: Judgment-MVXA.16.2018.doc additional capability. In commercial parlance, the understanding is that a printer with supplementary capabilities and functions has been sold. The buyer, instead of requiring to invest in four separate machines, viz printer, scanner, fax and copier, can obtain all these capabilities by purchasing a multi-functional printer.
14. The essential argument of the appellant has been that such printers are classifiable under Entry 84.71 of the Notification dated 1st April, 2005 as input unit or output unit. It is submitted that Entry A.2.1 of the Schedule to the MVAT Act enumerates the list of goods, which are to be at the rate of 4% or 5% depending upon the relevant time period. Entry C-56 is in respect of IT products, as may be notified by the Government from time to time. It is claimed that in exercise of the powers conferred by Entry C-56 of the Schedule to the MVAT Act, the Government of Maharashtra notified, vide notification dated 1st April, 2005, the IT products. This notification remained in force from 1 st April, 2005 till 16th October, 2005. After 17th October, 2005, the earlier notification was superseded by notification dated 17th October, 2005. However, according to Mr.Sridharan, the present appeal pertains to notification dated 1st April, 2005. We should, therefore, be concerned with the interpretation of this Page 8 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:12 ::: Judgment-MVXA.16.2018.doc notification, copy of which is at Exhibit 'G'. Mr.Sridharan submits that Sr. No. 3 of this notification in corresponding column 2 refers to the Central Excise Tariff Heading 84.71 and in column 3 describes the goods as automatic data processing machines and units thereof, magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such data. It also contains further elaboration.
15. The argument of Mr.Sridharan is that these products are classifiable under Entry 84.71 of the IT products notified as input units or output units, but these terms have not been defined anywhere in the notification. Hence, they would have to be interpreted in their ordinary sense and meaning. Relying upon the dictionary of science and technology so as to give a meaning to these terms and expressions and the dictionary of scientific and technical terms (6th Edition), Mr.Sridharan would urge that coupled with other dictionaries, including the Penguin Dictionary of Electronics (3rd Edition), the Dictionary of Computer Terms (3rd Edition) would denote that input means the receipt of information by a device, whereas, output means retrieval of information from a device in a manner understandable by the user. Mr.Sridharan, therefore, submits that multi-functional printers are classifiable under Entry 84.71 of the notification and are thus covered. Page 9 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:12 ::: Judgment-MVXA.16.2018.doc
16. The without prejudice submission of Mr.Sridharan is that the multi-functional printers are classifiable under 84.71 of the IT Product Notification as an "automatic data processing machine"
or units thereof or as other units of automatic data processing units.
17. It is submitted that the appellant places reliance on Note 1 of the IT Products Notification to interpret the meaning of the above phrases in the light of the explanatory notes issued by the Customs Co-operation Council, Brussels.
18. In any case, the above is supported by the decision of Hon'ble Supreme Court in the case of Reckitt Benckiser (India) Limited vs. CCT 1, wherein it has been held that when the entries under the VAT Schedule are aligned to Customs Tariff, which, in turn, is aligned with HSN, then, reference can be made to HSN for the purposes of classification under the VAT Schedule.
19. It is strongly emphasized that the appellant is not placing reliance on Note 2 of the IT products notification to contend that the classification adopted by the appellant under Customs and Central Excise would be applicable to VAT as well. This is not the contention of the appellant. This was the very error in the 1 (2008 15 VST 10(SC) Page 10 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:12 ::: Judgment-MVXA.16.2018.doc impugned order of the tribunal. Rather the appellant is merely relying on Note 1 to refer and place reliance on the terms defined in the HSN Explanatory Notes.
20. Finally, Mr. Sridharan contends that as with the matter before the Hon'ble Rajasthan High Court, the multi-functional printers sold by the appellant are predominantly laser jet printers which also have the additional functions of scan and fax. As already established, these products, however, must be classified under the Entry satisfying their primary character, which in this case is printing. This is in accordance with the dominant nature test as laid down by the Hon'ble Supreme Court in the Xerox India matter.
21. As already established above, multi-functional printers are modular units which connect to the computer/computer network and are used in automation activity of printing. The heart of the multi-functional printers consists of a printing mechanism to perform the basic function of printing. In addition to the primary function of printing, other incidental functions performed by the multi-functional printers are scanning and copying or scanning, copying and fax. However, the essential function of the product is nothing but printing.
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22. A multi-functional printer is sold and marketed as a printer with additional capabilities such as copy, fax and scan. Thus, the understanding in the commercial parlance and of the end customer/user is that of a printer, with supplementary features and capabilities. Rather than having to invest in four separate machines of printer, scanner, fax and copier, the user can obtain all these capabilities by purchasing a multi-functional printer.
23. Therefore, the printers sold by the appellant are classifiable under Entry 84.71 of the IT Products Notification as "laser jet printers". The specific entry must prevail over the residuary entry and hence, the appellant's goods cannot be classified under the residuary entry.
24. It is submitted by Mr. Sridharan that without prejudice to the submissions made above, in any case, even if multi-functional printers are conceivably classifiable both under Entry 84.71 of the IT Products Notification as also the residuary Entry, benefit should be given to the appellant. This view has been expressed by the Hon'ble Supreme Court in a number of cases, including the aforementioned matter of Mauri Yeast where the following was held:-
"It is now a well-settled principle of law that when two views are possible, one which favours the Assessee should be adopted."Page 12 of 41
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25. It is submitted that the appellant has made out a more than strong case vide Grounds A, B & C of the appeal that the multi- functional printers sold by the appellant are classifiable under Entry 84.71 of the IT products notification. Given so, the benefit of interpretation must be given to the appellant.
26. Mr. Sridharan also submits that the refundable security received by the appellants from the customers in lease transactions cannot be part of the sales price for the purpose of taxation. In that regard, it is submitted that it is the case of the Department that the refundable security collected by the appellant from its customers, when it leases out printers to its customers, is includible in the sale price for the purposes of discharging VAT on the said lease on account of Explanation III to Section 2(25) of the MVAT Act.
27. It is submitted that on an interpretation of Explanation III, the refundable security collected by the appellant would be outside its scope. The refundable security collected by the appellant is in the nature of an indemnity in case any damage or theft or other harm is caused to the leased printer by the customer. In such a case, the security is forfeited to compensate for the damage incurred by the appellant. In all other cases, the Page 13 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:12 ::: Judgment-MVXA.16.2018.doc security is refunded to the customer upon the termination of the lease and return of the leased printer or adjusted against amounts payable by the customer towards lease rental.
28. It is submitted that Explanation III does not cover the receipt of securities which are in that nature of securities.
29. It is submitted that Explanation III to Section 2(25) of the MVAT Act is identical to Explanation III to Section 2(29) of the Bombay Sales Tax Act, 1959 which was inserted by Mah. Act 17 of 1999 w.e.f. 04.04.1997. Trade Circular 10T of 1999 was issued at the same time to explain the scope of the said Explanation. The relevant portion of the said Circular is extracted infra:-
"(ii) It had been noticed recently that in certain sectors notable in the electronic goods sector a new method of marketing had been introduced. An item which would ordinarily be sold at say Rs.20,000/- was being billed at say Rs.12,000/-. However, the customer was required to give a deposit of Rs.8,000/- to the seller. The deposits in many cases were made refundable after five years or so with no interest or negligible interest. This was clearly a device to evade sales tax. The amendment has been with a view the plug the loophole."
30. For all these reasons, Mr.Sridharan would submit that the impugned order should be set aside and the appeal be allowed.
31. Ms. Jyoti Chavan learned AGP appearing for the respondents submitted that the view taken by the tribunal is correct and there is no perversity or error of law apparent on the Page 14 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc face of the record therein. She submitted that Entry 56 of Schedule 'C' appended to the MVAT Act is pertaining to IT products taxable at 4% as notified by the Government from time to time. The notification under this entry is issued on 1st April, 2005. The excise tariff heading 84.71, out of which major part is notified under Entry C-56 does not include the product in question. In other words, multi-functional unit is not mentioned in this notification. It is clear that interpretation under the Central Excise Act would not be helpful in interpreting the notification dated 1st April, 2005. It is in these circumstances that the tribunal correctly understood the issue and the controversy. Reliance is placed upon the notification dated 17 th October, 2005 pertaining to IT products and it is urged that this would not cover the product in question. It is, therefore, submitted that the appeal be dismissed.
32. It is argued that in the appellant's own case, the High Court at Delhi in a decision in Sales Tax Appeal No. 6 of 2010, decided on 4th May, 2012 and construing a similar entry, has held that the multi-functional machines/printers will not fall under a specific sub-heading, but would fall under the subject heading, namely, 84.71 i.e. "others". It is in these circumstances that it is urged that this appeal be dismissed.
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33. At the outset, we have clarified that questions (d) and (f) at page 8 of the paper book are not pressed. They are kept open for a decision in an appropriate case. It is clear from the above narrated facts and circumstances of the case that the question before the tribunal was whether the multi-functional printers would attract the rate of tax at 12.5%. In that regard, it would be relevant to take note of the application under section 56 of the MVAT Act, made by the appellant before the Commissioner of Sales Tax, Maharashtra. It was urged that this company is engaged in the business of sales and maintenance of digital products having computer interface and connectivity. It was claimed that the products are a total solution for the entire documentation of any organisation, namely, digital processing, printing, fax etc. It is stated that the digital multi-functional product is covered by the Central Excise Tariff Entry No. 84.71 and hence, it was covered by Entry No. C-56 liable to the rate of tax at 4%. Then, the other products, spares, developer, drum and toner are covered by Central Excise Tariff Entry No. 84.73. It is suitable for use solely for digital processing unit covered by Tariff Entry No. 84.71. Therefore, these goods are also liable to a rate of tax at 4% under Entry C-56. The application sets out all the Page 16 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc details and then claims that the rate of tax/tax liability, on the 12 transactions described in para 2 of this application dated 14th July, 2005, be decided.
34. The Commissioner, by the order at Exhibit 'E' at page 90 of the paper book, noted these facts and contentions. He noted the fact that the digital multi-functional product is claimed to be a photo copier and as also has a printer, fax machine, document server and scanner etc. The argument was that this is a IT product covered by Schedule Entry C-56 taxable at 5% and it is covered by excise heading 84.71. The Commissioner, however, was of the opinion that the heading 84.71 of the Central Excise Tariff includes certain particular input output units like teletypewriter, data entry terminal, line printer, dot matrix printer etc., but digital multi-functional machines, which do not come in the description as against the heading 84.71 are not covered by Schedule Entry C-56. The bill of entry shows clearance under Heading 84716029, which covers "other category". The description given against the heading as notified for the purpose of the MVAT Act does not include the "other category". The description given against the notified heading is specific. It does not include "digital multi-functional unit". Therefore, the product is not covered by Schedule Entry C-56 and Page 17 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc is taxable at 12.5%. Similar is the case with regard to spares, developer, drums and toner.
35. The matter went to tribunal and as noted above, the tribunal found that there are four issues, out of which, main issue is regarding the rate of tax on multi-functional printers/machines. The tribunal referred to the Schedule Entry C-56 and the notification dated 1st April, 2005. Schedule Entry C- 56 reads as under:-
"C-56 - IT products as maybe notified by the State Government from time to time."
36. The notification dated 1st April, 2005, copy of which is at pages 108 to 111 of the paper book, referable to this Entry C-56, reads as under:-
NOTIFICATION MAHARASHTRA VALUE ADDED TAX ACT, 2002 No.VAT-1505/CR-116/Taxation-1. - In exercise of the powers conferred by entry 56 of the Schedule 'C' appended to the Maharashtra Value Added Tax Act, 2002 (MAH.IX of 2005), the Government of Maharashtra hereby specifies the following goods, more particularly described in the Schedule appended hereto, to be the Information Technology products for the purposes of the said entry, namely :-
Schedule Information Technology products covered from time to time, under the headings, or sub-headings as the case may be, of the Central Excise Tariff Act, 1985 (5 of 1986) Serial Central Description No. Excise Tariff Heading (1) (2) (3) Page 18 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc 1 84.69 Automatic Typewriter and word processing machines, Word Processing machines.
2 84.70 Electronic calculator capable of operations without an external source of electrical power and pocket size data recording, reproducing and displaying machines with calculating functions (including electronic diaries other than those covered under heading No.84.71) or incorporating a printing device.
3 84.71 Automatic data processing machines and units thereof, magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such data.
Analogue or hybrid automatic data processing machine, Electronic Diaries, Portable digital automatic data processing machine, personal computer, computer systems including personal computers, others Digital automatic data processing machines comprising in the same housing at least a central processing unit and an input and output unit whether or not combined, micro computer / processor, large / mainframe computer, computer presented in form of systems, digital processing units, storage units, input units, output units, Teletypewriter, Data entry terminal, Line printer, Dot matrix printer, Letter quality daisy wheel printer, Graphic printer, Plotter, Laser jet printer, Key board, Monitor, storage units, floppy disc drive.
Winchester / hard disc drives, Removal /exchangeable disc drives, magnetic tape drives, Cartridge tape Page 19 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc drive, other units of automatic data processing machines, Uninterrupted power supply units (UPS).
4 84.73 Parts and accessories (other than covers, carrying cases and the like) suitable for use solely or principally with machines of heading No.84.70, parts and accessories of the machines of heading No.84.70, parts and accessories of the machines of heading No.84.71, Headstack, connectors for computer terminals, micro processor for automatic data processing machines of heading No.84.71, reconditioned components of computers, network access controllers.
5 85.01 DC Micro motors / Steppers motors of an output not exceeding 37.5 Watts.
6 85.03 Parts of goods specified in heading No.85.01 7 85.04 Uninterrupted Power Supplies (UPS) and their parts.
8 85.05 Permanent magnet and articles intended to become permanent magnet (ferrites).
9 85.17 Telephone sets, video phones, line
telephone sets with cordless
handsets, push button type, rotary
dial type, cordless telephones, video telephones/ video door phones, apparatus for carrier-current line systems of for digital line system, teleprinters, PLCC equipment, vice frequency telegraphy, modems, multiplexes / statistical multiplexes routers, X-25 pads, modems, High Bit Rate digital Subscriber Line System (HDSL) Digital loop carrier system (DLS), synchronous digital hierarchy (SDH), ISDN Terminals Subscriber End Equipment, ISDN Terminal Adapters and parts of the equipments covered by this heading.
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11 85.20 Telephone answering machines.
12 85.22 Parts of telephone answering machines.
13 85.23 Magnetic tape for recording sound, audio magnetic tape, video magnetic tape, magnetic disc, hard disc pack, floppy disc or diskettes, rewritable magneto optical disc including mini disc, CD recordable, cards incorporating a magnetic stripe, mattresses for the production of records, prepared record blanks, cartridge tape, blank video cassettes, 3/4" U-matic and 1" video cassettes/tape 1/2" video cassettes suitable to work with betacam / betacam SP/M-II S-VHS/Digital S type VCR, 8mm video tapes / cassettes in finished form, 6.35 mm (1/4") digital video cassettes and DV tapes suitable to work with digital video camera, blank master disc, blank audio cassettes, audio tape cassettes in finished form (Blank), optical media discs, CD Recordable, CD Rewritable.
14 85.24 Software including Information Technology software on any media, video compact disc of educational nature, other video compact discs and digital video discs.
15 85.25 Transmission apparatus other than apparatus for radio broadcasting or TV broadcasting, transmission apparatus incorporating reception apparatus, digital still image video cameras.
16 85.27 Radio Communications receivers, radio pagers.
17 85.29 (1) Aerials, antennae and their parts.
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18 85.31 LCD panels, LED panel and parts thereof.
19 85.32 Electrical capacitors, fixed variable or adjustable (preset) and parts thereof.
20 85.33 Electrical resistors (including rheostats and potentiometers), other than heating resistors.
21 85.34 Printed Circuits.
22 85.36 Switches, connectors and relays for upto 5 amps at voltage not exceeding 250 volts, electronic fuses.
23 85.40 Data/Graphic Display tubes, other than TV picture tubes and parts thereof.
24 85.41 Diodes transistors and similar semiconductor devices; photo sensitive semiconductive devices, including photovoltaic cells whether or not assembled in modules or made-up into panels; light emitting diodes; mounted peizo-electric crystals.
25 85.42 Electronic integrated circuits and micro assemblies.
26 85.43 Signal generators and parts thereof. 27 85.44 Optical fibre cables.
28 90.01 Optical fire and optical fibre bundles and cables.
29 90.13 Liquid crystal devices, flat panel display devices and parts thereof.
30 90.30 Cathode ray oscilloscopes, spectrum analysers, cross talk meters, gain measuring instruments, distortion factor meteres, psophometeres, network and logic analysers and signal analysers.
Page 22 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc Note.-(1) The Rules for the interpretation of the provisions of the Central Excise Tariff Act, 1985 read with the Explanatory Notes as updated from time to time published by the Customs Co-operation Council, Brussels apply for the interpretation of this notification.
Note.-(2) Where any commodities are described against any heading or, as the case may be, sub-heading, and the aforesaid description is different in any manner from the corresponding description in the Central Excise Tariff Act, 1985, then only those commodities described as aforesaid will be covered by the scope of this notification and other commodities though covered by the corresponding description in the Central Excise Tariff will not be covered by the scope of this notification.
Note.-(3) Subject to Note 2, for the purpose of any entry contained in this notification, where the description against any heading or, as the case may be, sub-heading, matches fully with the corresponding description in the Central Excise Tariff, then all the commodities covered for the purposes of the said tariff under that heading or sub-heading will be covered by the scope of this notification. Note.-(4) Where the description against any heading or sub- heading is shown as "other", then the interpretation as provided in Note 2 shall apply.
By order and in the name of the Governor of Maharashtra, SUDHAKAR JAMODE, Deputy Secretary to Government.
37. A bare perusal of this notification would reveal that the Government of Maharashtra specified the goods in the Schedule to be IT products for the purpose of the said Entry 56 and at Sr.No.3 corresponding to Central Excise Tariff Heading 84.71, automatic date processing machines and units thereof, magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such date, are Page 23 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc enlisted. The argument before the Commissioner as also before the tribunal is that the products are covered by this notification and Entry C-56, which attract the rate of tax at 4%. The tribunal, after reproducing the relevant material, came to the conclusion that the goods were cleared under Excise Heading 84716029, namely, "others" and the same is not notified by the State Government for Entry 56 of Schedule 'C' as IT products. The relevant portion of that excise entry has also been noticed, but what is emphasised before us is that the appellant is not relying upon Note 2 of the notification dated 1st April, 2005. The appellant is relying on Note 1 to refer and place reliance on the terms defined in the HSN Explanatory Notes. Note 5A to Chapter 84 of the HSN Explanatory Notes defines the expression "automatic data processing machine" to mean machines capable of storing the processing programme or programmes and at least the data immediately necessary for the execution of the programme, being freely programmed in accordance with the requirements of the user, performing arithmetical computations specified by the user and executing, without human intervention, a processing programme which requires them to modify their execution, by logical decision during the processing run. Then, the other Notes, namely, 5(B) and 5(C) to Chapter 84.71 of the HSN Explanatory Notes are relied upon to urge that the multi- Page 24 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc function printers sold by the appellant satisfy Chapter Note 5C and are hence units of automatic data processing machines. The multi-functional printers of the appellant cannot be operated independently but are designed to operate in conjunction with an automatic data processing machine such as a computer. It is connected to the central processing unit of the automatic data processing machine by a wire or even wirelessly and is able to accept data from the same and deliver data in a form usable by the system. Thus, the argument is that the multi-functional printers satisfy the three fold test of Chapter Note 5C and are hence classifiable as units of automatic data processing machine in Entry 84.71 of the IT products notification. The tribunal came to the conclusion that the notification dated 1st April, 2005 does not enlist the products falling under the heading "others" and that is how the appellant's product is not covered under Entry 56 of Schedule 'C' of the MVAT Act. It may be a IT product, but not notified for the purpose of reduced rate of tax.
38. The tribunal placed very strong reliance on the judgment of the Delhi High Court in the appellant's own case. There, the argument was that an application for advance ruling was made before the Commissioner under section 84 of the Delhi Value Added Tax Act, 2004. The tribunal upheld the finding of the Page 25 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc Commissioner that multi-functional printers/copiers/scanners having HSN Code No. 8471.60.29 and sales of spares and consumables of the above products having HSN Code No.8473.30.99 during the period 1 st April, 2005 to 31st March, 2007, are taxable under the residuary head and, therefore, attract VAT at 12.5% and are not falling under Entry 41A of the Third Schedule to the Act and therefore, are not taxable at 4%. Paragraphs 2 to 8 of the judgment of the Delhi High Court read as under:-
2 The substantial question of law, on which we have heard learned counsel for the parties and which requires adjudication, is as under :
"Whether the multi-functional printers/machines and their spares and consumables, during the period April 1, 2005 to March 31, 2007, are taxable under entry 41A of the Third Schedule to the Delhi Value Added Tax Act, 2004 or are taxable under the residuary head at 12.5 per cent?"
3 The appellant had filed an application under section 84 of the VAT Act seeking advance ruling in respect of the applicable VAT rate on the multi-functional printers/machines and their spares and consumables during the period April 1, 2005 to March 31, 2007 (hereinafter referred to as "the relevant period"). We may notice that the application and the question raised in the said application itself stated that the multi-functional printers/ copiers/ Page 26 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc scanners fall under the HSN code No.8471.60.29 and the spares and consumables fall under the HSN code No.8473.30.99. However, the declaration/statement ignores the controversy, whether the product(s) of the appellant are in fact "multi-functional printers", which fall within the aforesaid HSN code. Another aspect/question raised is whether and to what extent the HSN code is applicable as far as entry No.41A to the Third Schedule of the VAT Act is concerned.
4 Sales tax on inter-State sale is levied by the Union Government under entry 92A of List I, while sales tax or value added tax on intra-State transactions is a State subject and each State has power to legislate on the said subject and impose taxes on sale/purchase of goods other than the newspapers and is authorized under entry 54 of List II of the Constitution.
5 There are four Schedules to the VAT Act relating to the rate of tax. Schedule I consists of goods which are exempt from tax. There are three entries in Schedule II and the goods mentioned in the said entries are taxable at one per cent. Goods mentioned in Schedule III are taxable at four per cent (enhanced to five per cent after January 13, 2010). There are 12 entries in Schedule IV and the goods mentioned in the said entries are taxable at 20 per cent. All other goods which are not classified and mentioned in the Schedules I to IV are taxable at 12.5 per cent. The main and principal dispute is whether the products sold by the appellant are covered by entry 41A of the Third Schedule to the VAT Act or are unclassified goods that attract tax at 12.5 per cent. In case the goods in question are covered by entry 41A of the Third Schedule to the VAT Act, the tax payable is at four per cent, otherwise, the tax is payable at 12.5 per cent. Page 27 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc 6 During the relevant period, entry 41A of the Third Schedule has undergone three amendments. During the period April 1, 2005 to August 7, 2005, entries 41 and 41A were as under:
Entry Description
No.
41 IT products including computers, telephone and
parts thereof, teleprinter and wireless equipment and parts thereof.
41A IT products notified by the Ministry of IT as specified below :
(i to xxii) ...
(xxiii) computer systems and peripherals, electronic diaries.
..."
7 During the period August 8, 2005 to November 29, 2005, entry Nos.41 and 41A were as under:
Entry No. Description
41 Computers, telephone and parts thereof,
telephone and wireless equipments and parts thereof.....
41A IT products notified by the Ministry of IT as specified below:
(i to xxii).....
(xxiii) Computer systems and peripherals, electronic diaries.
...."
Page 28 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc 8 Entries 41 and 41A underwent substantial changes with effect from November 30, 2005 and thereafter during the relevant period, read:
"41. Computes, telephone and parts thereof, teleprinter and wireless equipment and parts thereof, mobile phone and all mobile accessories costing up to rupees ten thousand.
41A. Information technology products as per the description in column (2) below, as covered under the headings, or sub-headings mentioned in column (3), as the case may be, of the Central Excise Tariff Act, 1985 (5 of 1986).
SL No. Description Central
Excise
Tariff
Headin
g
(1) (2) (3)
1. ... ...
2. ... ...
3. Automatic data 8471
processing machines
and units thereof,
magnetic or optical
readers, machines
for transcribing data
into data media in
coded form and
machines for
processing such data.
Analogue or hybrid
automatic data
processing machine,
electronic diaries,
portable digital
automatic data
Page 29 of 41
J.V.Salunke,PA
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Judgment-MVXA.16.2018.doc
processing machine,
personal computer,
computer systems
including personal
computer, other
digital automatic
data processing
machines comprising
in the same housing
at least a central
processing unit and
an input and output
unit whether or not
combined, micro
computer/processor,
large/ mainframe
computer, computer
presented in from of
systems, digital
processing units,
storage units, input
units, output units,
teletypewriter, data
entry terminal, line
printer, dot matrix
printer, letter quality
daisy wheel printer,
graphic printer,
plotter, laser jet
printer, key board,
monitor, storage
units, floppy disc
drive.
Winchester/hard
disc drives, removal/
exchangeable disc
drives, magnetic tape
drives, cartridge
tape drive, other
units of automatic
data processing
machines,
uninterrupted power
supply units (UPS)
Note.- (1) The Rules for the interpretation of the provisions of the Central Excise Tariff Act, 1985 read with the Explanatory notes as updated from time to time published by the Customs Co-operation Council, Brussels, apply for the interpretation of this entry and the entry number 84 of this Schedule.Page 30 of 41
J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc Note.-(2) Where any commodities are described against any heading or, as the case may be, sub-heading, and the description in this entry and in entry 84 is different in any manner from the corresponding description in the Central Excise Tariff Act, 1985, then, only those commodities described in this entry and in the entry number 84 will be covered by the scope of this notification and other commodities though covered by the corresponding description in the Central excise tariff will not be covered by the scope of this notification.
Note.-(3) Subject to Note (2), for the purpose of any entry contained in this notification, where the description against any heading or, as the case may be, sub-heading, matches fully with the corresponding description in the Central Excise Tariff, then all the commodities covered for the purpose of the said tariff under that heading or sub- heading will be covered by the scope of this notification.
Note.-(4) Where the description against any heading or sub-heading is shown as 'other', then, the interpretation as provided in Note 2 shall apply."
39. The Delhi High Court was of the view that the multi- functional machines in the case of Xerox India Limited vs. Commissioner of Customs, Mumbai2, which were principally performing the function of a printer, should be classified under 2 (2010) 14 SCC 430 Page 31 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc the Head 84.71.60 and they could not be classified under the residuary heading 84.79.89 for the purpose of taxation under the Customs Act, 1962. The judgment of the Hon'ble Supreme Court in the case of Xerox India Limited (supra) was referred by the Delhi High Court and in paras 12 to 15, it concluded as under:-
"12 The contention of the appellant is that the aforesaid decision is squarely applicable and has been wrongly ignored and not applied by the Tribunal. The contention of the respondent is to the contrary. Reference by both the parties was made to the four notes in the VAT Act applicable to entry 41, which have been quoted above with reference to application of the Rules of Interpretation of the provisions of Central Excise Tariff Act, 1985 read with the explanatory notes.
13 At first, we deem it appropriate to examine the four notes in the VAT Act. Note (1) stipulates that Rules for interpretation of the provisions of the Central Excise Tariff Act, 1985 read with explanatory notes "as updated from time to time" published by the Customs Cooperation Council, Brussels will apply for interpretation. Note (2) states that where commodities described in any heading or sub-heading in the specified entries in the VAT Act are different from the corresponding description in the Central Excise Tariff Act, 1985, then the commodities described in the entry in the VAT Act would be covered by the scope of the notification, (i.e., the notification in question issued under the VAT Act) and the commodity covered by corresponding description in the Central Excise Tariff Act, 1985 shall not cover the scope of the notification. Note (2) is rather ambiguous and is capable of different interpretations. In these circumstances, it is Page 32 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc important to understand the purport and objective behind the said note. A glance at the entries of the said notification would show that under column (2) commodities by description have been stated and under column (3) reference is made to the Central Excise Tariff Heading. Note (2) seeks to clarify and state that in case the entry or description in column (2) matches with the description of the entry in the Central Excise Tariff Act, 1985, then the entry in the VAT Act should be given the same meaning to cover/include the goods specified in the corresponding entry in the Central Excise Tariff Act, 1985. However, in case the description of the goods in column (2) of the entry is different from the corresponding description of the goods in the Central Excise Tariff Act, 1985, reference to the entry in the Central Excise Tariff Act, 1985 should not be made. This becomes clear when we read Note (3). The said note stipulates that when description of any heading or sub-heading in the Act matches with the corresponding description in the Central Excise Tariff Act, 1985, then, all commodities covered for the purpose of the said tariff under the Central Excise Tariff Act, 1985, would be covered under the scope of the notification. Note (3) also clarifies that the term "notification" is not with reference to the four notes, but the notification issued under the VAT Act.
The reason is obvious that any gods not covered by the notification would fall outside the scope of Schedule III and would not be taxable at 4-5 per cent, but at 12.5 per cent. The aforesaid interpretation, gains strength and merits acceptance when we refer and interpret Note (4). Note (4) states that if the commodity of goods falls under the heading or sub-heading "other" in the Central Excise Tariff Act, 1985, then interpretation stipulated in Note (2) would apply. In other words, the goods would be covered by the residuary provision and taxable accordingly. The word "heading" in Page 33 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc Note (4) is superfluous as the word "other" never appears in the heading, but can be a sub-heading under the Central Excise Tariff Act, 1985.
14 Thus, rule (1) is a general rule of interpretation and is not subject to rules (2) to (4). Rules (2) to (4) require that we should examine the description in column (2) and compare it with the description of the goods mentioned in the relevant entry in the Central Excise Tariff Act, 1985. If the same are identical, then we should apply the same interpretation, as has been given to the entry in the Central Excise Tariff Act, 1985. If the entires are not identical or the commodity falls under the heading "other" in the Central Excise Tariff Act, 1985, then we have to look at the second column of the Schedule to find out whether the commodities are covered by the said column. In case commodities/goods are not covered by the description given in the column, then commodities/goods will fall under the residuary tax rate. 15 The aforesaid notification containing notes (1) to (4) is applicable with effect from November 31, 2005 and do not apply to the period prior thereto. Therefore, for the period prior to November 31, 2005, we need not refer to entry No.8471 of the Central Excise Tariff Act, 1985. For the relevant period, we have to only refer to the entry Schedule XXIII, which reads:
"computer systems and peripherals, electronic diaries"
40. The Delhi High Court then held that the multi-functional machines or printers can be termed as computer peripheral if its principal or sole purpose is to be attached and function as a computer ancillary. A multi-functional machine will be and Page 34 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc qualify as a computer peripheral when its main/predominant purpose is to scan documents, load data or work as an input device of the computer or work as an output device to take printouts from the computer. At the same time, there can be photocopiers, whose main purpose is to copy or act as a duplicating machine to make copies of documents. Incidentally, they may also be used as a printer. This would require elucidation and examination of factual matrix in each case and the machine in question on case to case basis. The Hon'ble Supreme Court judgment was once again referred to in para 18 of the Delhi High Court judgment and therefore, it came to the conclusion that before 30th November, 2005 can this machine be said to be a IT product. Before 30th November, 2005 the position has been considered and it is held that Note 4 to the notification under the Delhi Value Added Tax Act, 2004 with reference to Entry 41A specifically states that it would not apply in case the goods falling under sub-heading "others" in the Central Excise Tariff Act, 1985. Hence, the other issue was not required to be considered.
41. In our case, the tribunal followed the Delhi High Court judgment and dismissed the VAT Appeal. A similar note, as is referred in the Delhi High Court judgment, is also found in the notification dated 1st April, 2005 and it says that where the Page 35 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc description against any heading or sub-heading is shown as "other", then the interpretation as provided in Note 2 shall apply. Thus, when any commodities are described in heading or as the case may be sub-heading and the aforesaid description is different in any manner from the corresponding description in the Central Excise Tariff Act, 1985, then only those commodities described as aforesaid will be covered by the scope of this notification and other commodities though covered by the corresponding description in the Central Excise Tariff will not be covered by the scope of this notification.
42. To our mind, this interpretation of the tribunal before us is consistent with Entry C-56 and the notification. Mr.Sridharan, however, made serious attempt to urge that Chapter 84 of the Central Excise Tariff Act, 1985 and Tariff Item 84.71 refers to automatic data processing machines and units thereof or printers appearing below Tariff Item No. 84716010 refers to various printers, Tariff Item 84716029 refers to others and Tariff Item 84716050 refers to scanners. Mr.Sridharan would submit that this very entry underwent a change and as it stood prior to 28 th February, 2005, it specifically refers only to automatic data processing machines and units thereof, magnetic or optical readers, machines for transcribing data onto data media in coded Page 36 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc form and machines for processing such data not elsewhere specified or included. True it is that this Central Excise Tariff heading is referred in the notification under the MVAT Act, but the notes below the same cannot be ignored. The Commissioner as also the tribunal found that the description given against the heading as notified for the purpose of MVAT Act does not include "other" category. The description given against the notified entry is specific. It does not include digital multi-functional unit in it. That is why the product is not covered by Schedule Entry C-56 and is taxable at 12.5%.
43. The other argument is that Entry C-56 is in respect of IT products, as may be notified by the Government from time to time. We are mindful of the fact that, that is how the Entry C-56 reads, but though it refers to IT products, it equally says "as maybe notified by the State Government from time to time". In the notification in question, the products have been defined and those are automatic data processing machines and units thereof and various other products. It may be that the appellant contends that the multi-functional printers sold by them are classifiable under Entry 84.71 of the IT products notification as input units and output units and these words having not been defined, they must be understood in their ordinary sense. So Page 37 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc understood, the multi-functional products are squarely covered by the term "input units" and "output units". The multi-functional printers are able to receive information put by an user into the computer or via a document provided in the scanner. This information is then brought out by printing, copying or scanning into storage. We are not in agreement with Mr.Sridharan and accepting his argument would mean we ignore and brush aside the notification dated 1st April, 2005. It may be that multi- functional printers are classifiable under Entry 84.71 of the IT products notification as automatic data processing machine or units thereof or as other units of automatic data processing units, but insofar as the subject notification is concerned, they have not been included. It may be that the multi-functional printers of the appellant cannot be operated independently, but are designed to operate in conjunction with an automatic data processing machine such as a computer. It may be that it is connected to central processing unit of the automatic data processing machine via a cable to accept data from the same and deliver data in a form usable by the system. Once the controversy is to be decided on the touchstone of the MVAT Act and the Schedule Entry thereto and the notification referred therein, then, function and usage of the multi-functional printers can hardly be of any assistance.
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44. The judgments relied upon by Mr.Sridharan are clearly distinguishable. In the case of Xerox India Limited (supra), the issue raised before the Hon'ble Supreme Court was with reference to the multi-functional machines imported by the appellant therein and whether they would fall under Chapter sub-heading 8479.89 (residual) as claimed by the Revenue or under Chapter sub-heading 8471.60 as claimed by the appellants under the Customs Tariff Act, 1975. Thus, the controversy was to be decided with reference to the Customs Tariff Act, 1975. That is a distinct statute. If xerox machines are multi-functional machines performing the functions of printer/fax machines, copier and/or scanner and therefore required to be classified as printers in automatic inter-processing machines under Chapter heading 8471.60, then, the issue is materially different than the one falling for our consideration. It is with reference to that controversy that Chapter Note 5 to Chapter 84 of the Customs Tariff Act, 1975 was pressed into service and rightly so. In the subject notification, there is a clear reference only to the Central Excise Tariff Act, 1985. The MVAT Act notification does not make any reference to the Customs Tariff Act, 1975. It is, therefore, not necessary for us to take further note of the judgment in the case of Xerox India Limited (supra). That is clearly distinguishable. Page 39 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc
45. The other judgment relied upon by Mr.Sridharan is in the case of Commissioner Taxes Officer, Anti Evasion, Zone III, Jaipur vs. M/s. Hawlet Packard India Sales Pvt. Ltd.3 decided on 19th February, 2016. There, the issue was about taxability of multi- functional device, which carry out the function of scanning, photocopier, fax machine and as computer printer, under the provisions of the Rajasthan Value Added Tax Act, 2003. There, the assessee paid tax at 4% for the period 1 st April, 2006 to 9th March, 2010, but the Revenue demanded tax at 12.5/14% under the residuary entry. The issue was whether the products could be said to be multi-functional machines such as printers under heading 8471.60 of the Customs Tariff Act, 1975. The Rajasthan High Court went by the Customs Tariff Act and came to the conclusion that the entry is wider, which includes not only computer printers, but computer peripherals also. When there is such wording of the specific entry, then, there was no scope for taking recourse to the residuary entry. It is in these circumstances that the Madras High Court judgment in the case of Canon India (P) Ltd. vs. State of Tamil Nadu 4 was followed so also the judgment in the case of Xerox India Limited (supra). Once we have come to the conclusion that the same was under a distinct law, then, even this judgment is of no assistance. 3 S. B. Sales Tax Revision Petition No. 15 of 2010 4 (2015) 80 VST 483 (Mad) Page 40 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 ::: Judgment-MVXA.16.2018.doc
46. As a result of the above discussion, we are of the clear view that the appellant's products have been rightly classified as attracting the rate of duty at 12.5%. The substantial questions of law concurrently answered in favour of the Revenue and against the appellant-assessee by the impugned order do not require any other answer. In other words, the view taken by the tribunal is consistent with the notification and the Schedule Entry. It cannot be termed as perverse or vitiated by any error of law apparent on the face of the record. For all these reasons, this appeal fails. The substantial questions of law and particularly enumerated and framed above are answered in favour of the Revenue and against the assessee. The appeal is accordingly dismissed, but without any order as to costs.
(B.P.COLABAWALLA, J.) (S.C.DHARMADHIKARI, J.) Page 41 of 41 J.V.Salunke,PA ::: Uploaded on - 20/12/2018 ::: Downloaded on - 25/12/2018 22:06:13 :::