Madras High Court
M/S.Phoneix Medical Systems (P) Ltd vs The State Of Tamil Nadu on 26 June, 2013
Author: Chitra Venkataraman
Bench: Chitra Venkataraman, K.B.K.Vasuki
IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated : 26.06.2013 Coram The Honourable Mrs.Justice CHITRA VENKATARAMAN and The Honourable Ms.Justice K.B.K.VASUKI Tax Case (Revision) No.165 of 2011 --- M/s.Phoneix Medical Systems (P) Ltd No.6, Arcot Road Chennai-600 026 ...Petitioner -vs- The State of Tamil Nadu Represented by the Deputy Commissioner of Commercial Taxes Chennai ...Respondent Tax Case Revision filed under Section 38 of TNGST Act, 1959 to revise the order of the Tamil Nadu Sales Tax Appellate Tribunal, Additional Bench, Chennai dated 04.03.2011 passed in TA.No.354/02. For petitioner : Mr.B.Raveendran For respondent : Mr.V.Haribabu Addl.Govt.Pleader (Tax) ORDER
(The Order of the Court was made by CHITRA VENKATARAMAN, J.) The assessee is on revision as against the order of the Sales Tax Appellate Tribunal relating to the assessment year 1995-96 raising the following questions of law :-
"1. Whether the Appellate Tribunal was right in confirming the levy of tax at the higher rate of 5% when the equipments sold by the petitioner are electronic equipments liable to tax @ 3% under Entry 29 of Part B of the I Schedule to the TNGST Act, 1959 ?
2. Whether the Appellate Tribunal is wrong in ignoring the nature of the equipments sold by the petitioner and merely proceeding on the basis of the invoices found in the assessment file without looking at the brochures and nature of the equipment ?"
2. The assessee is a manufacturer and dealer in medical electronic items. The items dealt with by the assessee were Neonatal Intensive care Incubator, Neonatal Care Centre, Infant Warmer and Phototherapy Unit. Admittedly, in all these equipments, there is a micro-processor. Based on this, the assessee claimed that the same would fall under First Schedule Part C Entry 50 as it stood during 16.07.1996 and assessable at 3%.
3. The Revenue, however, contended that the item in question would fall under Entry 20, Part C, First Schedule, assessable at 5% till 16.07.1996. The Sales Tax Appellate Tribunal rejected the assessee's contention by referring to the Clarification issued on 30.05.1994 in No.D.Dis.Acts Cell II/11753/94. The Tribunal pointed out that to be an electronic medical instrument, the heart of such instrument must be electronic ; since there are no material evidence offered, the item in question, were to be assessed at 5%. Aggrieved by this, the present Tax Case Revision.
4. Entry 50, Part B of the First Schedule relevant to the case which stood upto 16.07.1996 reads as under:-
Part B, 50. Entry From 12.03.1993 to 16.07.1996.
S.No. Description of the goods Point of levy Rate of tax per cent (Effective from) 50 Electronic systems, instruments, apparatus, appliances and other electronic goods (other than those specified elsewhere in the schedule) but including electronic cash registering, indexing, card punching, franking, addressing machines, and computers of analog and digital varieties, one record units, word processor and other electronic goods and parts and accessories of all such goods At the point of first sale in the State 3 12393
5. Entry 20, Part C of the First Schedule from 01.04.1994 to 16.07.1996 reads as under:-
S.No. Description of the goods Point of levy Rate of tax per cent (Effective from) 20 Entry from 01.04.1994 to 16.07.1996 (B) Instruments and appliances used in medical, surgical, dental or veterinary sciences, including apparatus, other electromedical apparatus and sight testing instruments including opthalmoscope, Otoscope, Laryngoscope, Retinoscope, Binocular loupe, parts and accessories thereof (other than those specified elsewhere in this Schedule) At the point of first sale in the State 5 01.04 .1994
6. Even though learned counsel for the petitioner contended that the item in question is an electronic item and assessable at 3%, we find a specific entry to deal with medical instruments and appliances, which makes no reference to it being electrical or electronic. Thus irrespective of whether the parts or the heart of the instrument is electronic, the instrument of the petitioner is that of the medical instrument and the appliances, the Assessing Officer rightly brought the item under Entry 20, Part C of the First Schedule, assessable at 5%. It is settled law that when there is a special entry to deal with the item in question, one has to give preference to the same over the general entry. Entry 50, Part B of the First Schedule being the general entry, Entry 20, Part C of the First Schedule being one to deal with the instruments and appliances in medical, surgical, dental or veterinary science, we have no hesitation in confirming the order of the Sales Tax Appellate Tribunal that the assessee's product attract 5% tax as it comes under Entry 20, Part C of the First Schedule.
7. In the circumstances, the order of the Sales Tax Appellate Tribunal is confirmed. The Tax Case Revision stands dismissed. No costs.
(C.V.,J) (K.B.K.V.,J) 26.06.2013 Index:Yes Internet:Yes nvsri To 1.The Deputy Commissioner of Commercial Taxes Chennai. 2.The Appellate Assistant Commissioner (CT) VI, Chennai -108 3.The Tamil Nadu Sales Tax Appellate Tribunal (Additional Bench) Chennai-104. CHITRA VENKATARAMAN, J. and K.B.K.VASUKI, J. nvsri Tax Case (Revision).No.165 of 2011 26.06.2013