Kerala High Court
Brahmos Aerospace Thiruvananthapuram ... vs The Assistant Commissioner on 2 February, 2017
Author: K. Vinod Chandran
Bench: K.Vinod Chandran
IN THE HIGH COURT OF KERALA AT ERNAKULAM
PRESENT:
THE HONOURABLE MR.JUSTICE K.VINOD CHANDRAN
THURSDAY, THE 2ND DAY OF FEBRUARY 2017/13TH MAGHA, 1938
WP(C).No. 3507 of 2017 (K)
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PETITIONER(S):
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BRAHMOS AEROSPACE THIRUVANANTHAPURAM LTD.,
AIRPORT ROAD, CHACKAI BEACH P.O.
THIRUVANANTHAPURAM - 695007.
REPRESENTED BY ITS COMPANY SECRETARY -
MR.BINU ALEX V.
BY ADVS.SRI.JOSEPH MARKOSE (SR.)
SRI.V.ABRAHAM MARKOS
SRI.ABRAHAM JOSEPH MARKOS
SRI.ISAAC THOMAS
SRI.HARAN THOMAS GEORGE
SRI.GOVIND VIJAYAKUMARAN NAIR
RESPONDENT(S):
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1. THE ASSISTANT COMMISSIONER
(CONTRACTS WORKS), COMMERCIAL TAXES,
THIRUVANANTHAPURAM
2. DEPUTY COMMISSIONER (APPEALS),
COMMERCIAL TAXES, THIRUVANANTHAPURAM.
3. THE INSPECTING ASSISTANT COMMISSIONER
DEPARTMENT OF COMMERCIAL TAXES,
THIRUVANANTHAPURAM
BY GOVERNMENT PLEADER SRI.V.K.SHAMSUDHEEN
THIS WRIT PETITION (CIVIL) HAVING COME UP FOR
ADMISSION ON 02-02-2017, THE COURT ON THE SAME
DAY DELIVERED THE FOLLOWING:
bp
WP(C).No. 3507 of 2017 (K)
APPENDIX
PETITIONER'S EXHIBITS :
P1: COPY OF PROCEEDINGS OF THE HEARING HELD ON 7/9/2015
BEFORE BIFR.
P2: COPY OF NOTICE UNDER SECTION 25(1) DT 17/3/2016
PROPOSED TO ASSESS THE PROCESSING AS TAXABLE UNDER
KVAT ACT FOR ASSESSMENT YEARS 2009-10 TO 2013-14 BY
THE R1.
P3: COPY OF REPLY DT 28/4/2016 TO EXHIBIT P2 ALONG WITH
ANNEXURES FILED BY THE PETITIONER BEFORE THE R1.
P4: COPY OF ASSESSMENT ORDER DT 3/10/2016 FOR ASSESSMENT
YEAR 2009-10 PASSED BY THE R1.
P5: COPY OF ASSESSMENT ORDER DT 3/10/2016 ASSESSMENT
YEAR 2010-11 PASSED BY THE R1.
P6: COPY OF ASSESSMENT ORDER DT 3/10/2016 FOR ASSESSMENT
YEAR 2011-12 PASSED BY THE R1.
P7: COPY OF ASSESSMENT ORDER DT 3/10/2016 FOR ASSESSMENT
YEAR 2012-13 PASSED BY THE R1.
P8: COPY OF ASSESSMENT ORDER DT 3/10/2016 FOR ASSESSMENT
YEAR 2013-14 PASSED BY THE R1.
P9: COPY OF APPEAL DT 13/10/2016 FOR ASSESSMENT YEAR
2009-10 FILED BY THE PETITIONER BEFORE THE R2.
P10: COPY OF APPEAL DT 13/10/2016 FOR ASSESSMENT YEAR
2010-11 FILED BY THE PETITIONER BEFORE THE R2.
P11: COPY OF APPEAL DT 13/10/2016 FOR ASSESSMENT YEAR
2011-12 FILED BY THE PETITIONER BEFORE THE R2.
P12: COPY OF APPEAL DT 13/10/2016 FOR ASSESSMENT YEAR
2012-13 FILED BY THE PETITIONER BEFORE THE R2.
P13: COPY OF APPEAL DT 13/10/2016 FOR ASSESSMENT YEAR
2013-14 FILED BY THE PETITIONER BEFORE THE R2.
P14: COPY OF STAY PETITION DT 14/10/2016 FOR ASSESSMENT
YEAR 2009-10 FILED BY THE PETITIONER BEFORE THE R2.
..3..
..3..
WP(C).No. 3507 of 2017 (K)
P15: COPY OF STAY PETITION DT 14/10/2016 FOR ASSESSMENT
YEAR 2010-11 FILED BY THE PETITIONER BEFORE THE R2.
P16: COPY OF STAY PETITION DT 14/10/2016 FOR ASSESSMENT
YEAR 2011-12 FILED BY THE PETITIONER BEFORE THE R2.
P17: COPY OF STAY PETITION DT 14/10/2016 FOR ASSESSMENT
YEAR 2012-13 FILED BY THE PETITIONER BEFORE THE R2.
P18: COPY OF STAY PETITION DT 14/10/2016 FOR ASSESSMENT
YEAR 2013-14 FILED BY THE PETITIONER BEFORE THE R2.
P19: COPY OF JUDGMENT 18/10/2016 PASSED BY THE LEARNED
SINGLE JUDGE OF THIS HONOURABLE COURT IN WPC NO.
33274 OF 2016
P20: COPY OF ORDER DT 4/9/2007 PASSED BY THE COMMERCIAL
TAX OFFICER, WORKS CONTRACT, TRIVANDRUM.
P21: COPY OF WORK/PURCHASE ORDER DT 24/3/2009 ALONG WITH
ANNEXURE ISSUED BY THE DEPARTMENT OF SPACE, LIQUID
PROPULSION SYSTEMS CENTRE, VALIAMALA, THRIVANDRUM TO
THE PETITIONER.
P21(a): COPY OF GOODS FORWARDING NOTE DT 19/5/2009 ISSUED BY
THE DEPARTMENT OF SPACE, ISRO, LIQUID PROPULSION
SYSTEMS CENTRE, MAHENDRAGIRI.
P21(b): COPY OF EXCISE DUTY EXEMPTION CERTIFICATE
DT 22/11/2010 ISSUED BY THE HEAD, PURCHASE & STORES,
DEPARTMENT OF SPACE, THIRUVANANTHAPURAM
P21(c): COPY OF INVOICE DT 15/9/2011 ISSUED BY THE
PETITIONER TO ISRO.
P21(d): COPY OF MANUFACTURING PROCESSING FLOW DIAGRAM.
P21(e): COPY OF CERTIFICATE DT 22/12/2016 ISSUED BY GAS
TURBINE RESEARCH ESTABLISHMENT.
P22: COPY OF ORDER DT 30/11/2016 PASSED BY THE R2.
//TRUE COPY//
P.A. TO JUDGE
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K. VINOD CHANDRAN, J
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W.P(C) No. 3507 of 2017 K
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Dated this the 02nd day of February, 2017
J U D G M E N T
The petitioner is aggrieved with Ext.P22 order wherein 20% of the amount demanded for the years 2009- 10 to 2013-14 was directed to be paid along with furnishing adequate security for the balance amount. The petitioner contends that the petitioner is only doing a job work for the ISRO and that the entire materials are provided by ISRO and the fabricated components are handed over to the ISRO for the space/defense programme.
2. The Assessing Officer on examination of the contentions found that the petitioner is not paying any Service Tax and since there is a manufacture involved, the tansaction would be assessable under the VAT regime, WPC.No.3507/2017 : 2 : since there is a fabricated new product handed over to the principal.
3. The learned Senior Counsel appearing for the petitioner would submit that there would be no service element for reason of manufacture being covered under the negative list of the Finance Act, 1994. It is also contended that what is essentially done by the petitioner is the fabrication of work on a job work basis as awarded by the ISRO, which otherwise they themselves would have carried and excise duty would be leviable for such manufacture.
4. It is to be noticed that the petitioner is a company involved in the work of space/defence programme as carried out by the ISRO and one having major participation of the Central Government. In such circumstances, considering the fact that there is an WPC.No.3507/2017 : 3 : arguable prima facie case, it is only proper that the First Appellate authority consider the appeal and till then the recovery be kept in abeyance.
Ext.P22 shall stand set aside. Writ petition is allowed.
Sd/-
(K. VINOD CHANDRAN, JUDGE)
jma //true copy//
P.A to Judge