Madras High Court
M/S.Redington (India) Limited vs The State Of Tamil Nadu on 2 November, 2018
Author: C.Saravanan
Bench: C.Saravanan
1
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 02.11.2018
CORAM:
THE HONOURABLE MR.JUSTICE C.SARAVANAN
W.P.No.11234 of 2008
M/s.Redington (India) Limited,
Represented by its Senior Manager Commercial,
No.16, Cenotoph Road, Teynampet,
Chennai – 600 018. ..Petitioner
Versus
1. The State of Tamil Nadu
Rep.by the Secretary,
Commercial Taxed Department,
Fort St.George,
Chennai – 600 009.
2. The Commissioner of Commercial Taxes,
Office of Commissioner, Commercial Taxes,
Ezhilagam, Chennai – 600 005.
3. The Commercial Tax Officer,
Saidapet Assessment Circle,
No.3, Tank Square Street,
Saidapet, Chennai – 600 015. ..Respondent
Prayer: Writ Petition filed under Article 226 of the Constitution of
India praying to issue Writ of Certiorarified Mandamus or any other
appropriate writ by calling for the records pertaining to the Order
passed by the 3rd respondent proceedings No.T/6220701/2002-2003
dated 28.03.2008 and quash the same and consequently direct the 3rd
respondent to refund Rs.11,92,647/- (Rupees Eleven Lakhs ninety two
http://www.judis.nic.in
2
thousand six hundred and fourty seven only) being the Resale Tax paid
by the petitioner together with interest at 18% per annum and grant
cost.
For Petitioner : M/s.V.Pushpa
For Respondents : Mr.Mohammed Shaffig
Special Government Pleader
[for RR1 to 3]
*****
ORDER
The writ petitioner is aggrieved by the impugned order dated 28.03.2008. The 3rd respondent issued notice dated 04.10.2007, to revise the assessment to deny the benefit of exemption notification II(2)/CT/568/F6/2002 dated 01.07.2002 on printer cartridge and to levy resale tax under Section 3-H of the TNGST Act, 1959.
2. The Petitioner had replied to the above notice which culminated in the impugned order dated 28.03.2008 by the 3rd respondent. The 3rd respondent denied the exemption from resale tax for the Printer cartridge vide the impugned order.
3. The learned counsel for the petitioner has relied on the decision of the Division Bench of this Court in Canon India Private Limited and Ors. Vs. State of Tamil Nadu and Ors, [2013 (199) http://www.judis.nic.in 3 ECR 148 (Madras)]. The said decision has been rendered in the context of the Tamil Nadu VAT Act, 2006.
4. The learned counsel also submitted that the said decision of the Division Bench of this Court in the Canon India Private Limited case has been followed by yet another Division Bench of this Court in Kores India Ltd. Vs. State of Tamil Nadu - (2018) 66 GST 185 (Madras). The said decision was rendered in the context of TNGST Act, 1959 and dealt with similar issue.
5. Learned counsel therefore submits that the above writ petition filed by the petitioner should be allowed.
6. The Learned counsel also drew my attention of clarification issued by the Deputy commercial tax officer on 26.07.2002 wherein based on the representation of the computer Dealers Association, Casa Major Road, wherein it was informed that all the goods mentioned in item 18(1) of part B of the first schedule are exempted from re-sale tax.
7. Countering the arguments advanced on behalf of the petitioner, Mr.Mohammed Shaffiq, the learned Special Government Pleader for the respondents submitted that the reference to the decision of the Division Bench of this Court in Canon India Private http://www.judis.nic.in 4 Limited and Ors. Vs. State of Tamil Nadu and Ors, [2013 (199) ECR 148 (Madras)] is misplaced in as much as the said decision came to be rendered under the Provisions of the Tamil Nadu Value Added Tax 2006 and is based on the entries therein. The Court allowed the benefits to the assesse on the ground that “printer cartridge” would be considered as “computer peripherals” as there is no specific use of the expressions “consumable” under the Act. The relevant entry in the first schedule to the Value Added Tax read is as under:-
Serial No.68, Information Technology Products as notified by the Government Entry 22 diaries; Computer Systems and Peripherals, Electronic
(a) Computer systems, peripherals and parts
(b) Electronic diaries Entry 24 Parts and Accessories of goods mentioned in serial Nos.21, 11, 22 and 27.
8.He submitted that the Tariff classification and exemption under the TNGST Act, 1959 are not identical.
9. Learned Counsel for the respondent further submitted that the decision rendered in Canon India Private Limited is based on the http://www.judis.nic.in 5 decision of the Supreme Court in Commissioner of Central Excise, Mumbai Vs. CMS Computers Private Limited [2005-TIOL-57-SC- CX-LB] which was rendered in the context of valuation under the Central Excise Act as to whether the value of printers and monitors has to be included in the value of the Automatic Data Processing and are therefore not relevant for determining the classification of goods under the T.N.G.S.T.Act, 1959.
10.Learned Counsel further submitted that the decision of the Division Bench of this Court in Kores India Ltd. Vs. State of Tamil Nadu cited supra by the learned counsel for the petitioner cannot be applied, though it dealt with identical issue relating to exemption from re-sale tax on printer cartridge and toners.
11. The learned counsel for the respondent also drew my attention to the decision of the Supreme Court in Sterling Foods Vs. State of Karnataka and Another, [(1986) 3 Supreme Court Cases 469] wherein it was held thus:-
“This question, for the purpose of the Central Sales Tax Act, has to be determined on the basis of what is commonly known or recognised in commercial parlance. If in commercial parlance and according to what is understood in the trade by the dealer and the consumer, processed or frozen shrimps, prawns and lobsters retain their original character and identity as shrimps, prawns and http://www.judis.nic.in 6 lobsters and do not become a new distinct commodity and are as much 'shrimps, prawns and lobsters', as raw shrimps, prawns and lobsters, sub- section (3) of Section 5 of the Central Sales Tax Act would be attracted and if with a view to fulfilling the existing contracts for export, the assessee purchases raw shrimps, prawns and lobsters and processes and freezes them, such purchases of raw shrimps, prawns and lobsters would be deemed to be in course of export so as to be exempt from liability to State sales tax.”
12. I have gone through the text of the relevant entry in first schedule part - B to the T.N.G.S.T. Act, 1959. Entry (18) to the T.N.G.S.T.Act reads as under:-
“18. (i) Computers, personal, mini, mainframes and laptops of an alog and digital varieties including Automatic Teller Machines, their hardware and peripherals like modem and speakers, key board, monitor, mouse, CPU, floppies of all sizes, cartridge, tape driver, CD ROM drives, DAT Drives, hard disks, printers like dot matrix, ink jet and laser, line, line- matrix, scanners, multi media kits, plotters, computer consumables including DAT tapes, print ribbons, printer cartridges and cartridge tapes and computer cleaning kits.
(ii) Licensed software, including IT software.
(iii) Electronic items as notified by the Government.”
13. Sl.No(iv) to the exemption notification which came into force http://www.judis.nic.in 7 on 01.07.2002 reads as under :-
“Exemption in respect of the tax payable by any dealer under section 3-H of the TNGST Act on the resale of the following goods,
(i) Chemical fertilizers specified in item 14 of Part–B of First Schedule.
(ii)Fungicides, herbicides including weedicides, insecticides, pesticides, rodanticides, germicides and combinations thereof.
(iii) Bullion specified in item 1 of Part-A of First Schedule.
(iv) Computers and their hardwares and peripherals specified in sub-item (i) of item 18, Part-B of First Schedule.
14. Sl.No(iv) allows exemption only to computers and their hardwares and peripherals as specified in Sub item (i) of item 18 Part- B of the First Schedule.
15. Learned counsel for the respondent submits that the legislature has cautiously categorised S.No.18(i) in the First Schedule of the TNGST Act into three categories namely (i) computers
(ii)peripherals and (iii) consumables. Therefore, printer cartridges which are admittedly categorised as consumable in S.No.18(1) of the first schedule to the T.N.G.S.T.Act cannot be treated as peripherals for http://www.judis.nic.in 8 the purpose of the exemption notification. Though the argument of the learned counsel for the respondent appears attractive, I am bound by the Division Bench of this Court in Kores India Ltd. Vs. State of Tamil Nadu - (2018) 66 GST 185 (Madras), which has been recently passed dealing with an identical issue under the TNGST Act, 1959.
16. The learned counsel for the Revenue admits that the said order of the Court has neither been appealed nor stayed. Respectfully following the decision of the Division Bench in Kores India Ltd. Vs. State of Tamil Nadu, I am inclined to allow the writ petition.
16. In view of the above reasons, the writ petition is allowed with consequential relief. No cost.
02.11.2018 bri http://www.judis.nic.in 9 To
1. The Secretary, State of Tamil Nadu, Commercial Taxed Department, Fort St.George, Chennai – 600 009.
2. The Commissioner of Commercial Taxes, Office of Commissioner, Commercial Taxes, Ezhilagam, Chennai – 600 005.
3. The Commercial Tax Officer, Saidapet Assessment Circle, No.3, Tank Square Street, Saidapet, Chennai – 600 015.
http://www.judis.nic.in 10 C.SARAVANAN.J. bri W.P.No.11234 of 2008 02.11.2018 http://www.judis.nic.in