State Taxation Tribunal - Rajasthan
R.N. Products vs Assistant Commercial Taxes Officer on 20 December, 1996
Equivalent citations: [2000]119STC400(TRIBUNAL)
JUDGMENT
MILAP CHANDRA JAIN, J. (Chairman).
1. These applications have been filed under Section 8(1), Rajasthan Taxation Tribunal Act, 1995. In the first application it has been prayed that the notice dated April 18, 1996 for showing cause as to why tax be not imposed at the rate of 15 per cent with interest and penalty on the sale of mineral water to the tune of Rs. 2,62,875 during the assessment year 1992-93 and of Rs. 32,430 during assessment year 1993-94 be quashed. In the second application, order dated October 29, 1996 passed by the Deputy Commissioner (Appeals), Jodhpur, has been challenged by which he has confirmed the levy of tax on mineral water at the rate of 15 per cent along with interests and penalty relating to the assessment year 1991-92.
2. As the facts involved are similar and law applicable is same, both these cases are being decided by this common judgment.
3. The facts of the case may be summarised thus : The applicant carries on the business of processing water in the brand name of Classic Mineral Water. An application was moved under Section 12A, Rajasthan Sales Tax Act, 1954 (in short, "the Act") before the Additional Commissioner, Jaipur. He has passed an order in the case of Manohar Lal Sharma, S/o. Shri Kalyan Sahai Sharma on December 1, 1994, holding that mineral water is nothing but aerated water and is exigible to tax. On the basis of this decision, the assessing authority had issued notices for the assessment years 1992-93 and 1993-94. The petitioner has obtained a certificate from the Deputy Chief Medical and Health Officer, Jodhpur, and he has confirmed that mineral water is a pure drinking water and fit for human consumption. Mineral water is obtained by adding bleaching powder in the water obtained from the P.H.E.D. and it is passed through activated charcoal, it is not charged with any gas. Nothing is added in it or subtracted from it. It was exempted under Section 4(1), Rajasthan Sales Tax Act, 1954 (in short, "the Act"). The Additional Commissioner has seriously erred to hold that mineral water is aerated water and is exigible to tax. The non-petitioner had no jurisdiction to issue notice for levying tax upon the mineral water and to pass assessment order.
4. In reply to applications, it has been averred thus. The applicant has not come with the clean hands. He is not entitled to any relief. He has concealed the date of the order of the Additional Commissioner passed under Section 12A of the Act. Notice has rightly been issued. Applicant's case is not covered under Section 4(1) of the Act. Mineral water is nothing but aerated water. It is exigible to tax. Sales tax is being charged on the sale of mineral water. The application (first) is premature. The Deputy Chief Medical and Health Officer had no jurisdiction to issue such a certificate. The applications deserve to be dismissed with costs.
5. In both the cases, the question for consideration is whether mineral water was exigible to tax under the Act. Entry No. 15 of the Schedule of the Act was as follows :
"Water excluding distilled or aerated waters."
According to it, distilled water and aerated water were exigible to tax. They were not exempted from payment of tax under Section 4(1) of the Act. Mineral water was exigible to tax if it was distilled or aerated water otherwise not. On September 28, 1995, Notification No. F.4(25)FD/Gr. IV/92/ Part-II-21 has been issued under Section 15, Rajasthan Sales Tax Act, 1994 exempting from tax the sale or purchase of water excluding distilled, mineral or aerated waters. After this notification, the position has become crystal clear. According to it, mineral water and aerated water are not one and the same thing. If mineral water would have been aerated water, both of them would not have been mentioned in this notification. Both are now exigible to tax w.e.f. October 1, 1995. Undoubtedly, mineral water is not distilled water.
6. According to the Chambers Dictionary (20th Century), New Edition, 1983, the word "aerated" means "to put air into ; to charge with air or with carbon dioxide or with other gas (as aerated waters)."
7. Para Nos. 12, 13 and 14 of the original application (No. 75 of 1996) run as under :
"That the process is as under water.............received form PHE Department through water tape) Add bleaching powder (for re-bactrization) Water passing through activated charcoal (for removing bad smell) Bacteria free drinking water orderless and colurless.
Water ready for bottling Bottles ready for sale.
(13) That from above simple process the water is not charged with any gas, hence saying that water is an aerated water is totally wrong. (14) That viewed from any angle, the water remained water. Nothing is added nor anything is abstracted out of water. Hence the same is exempted under Section 4(1) of the RST Act. It is neither distilled nor aerated."
In the reply, nothing has been said in respect of these averments. It means that contents of these paras are admitted by the non-petitioner. It is clear from these averments that mineral water is nothing but water. As such it was not exigible to tax. The assessing authority has no jurisdiction to issue notice and to pass assessment order levying tax on its sale. In his order dated December 1, 1994 passed under Section 12A of the Act, the Additional Commissioner has held that mineral water and aerated water are one and the same thing and, therefore, mineral water is not exempted from tax. Both these applications deserves to be allowed.
8. Accordingly, the applications moved under Section 8(1), Rajasthan Taxation Tribunal Act, 1995 are allowed. Mineral water is held to be not taxable till September 30, 1995. The show cause notice and the assessment order imposing tax on the sale of mineral water are quashed. No order as to costs.