Indian Kanoon - Search engine for Indian Law

J.V.Salunke,PA Judgment-WP.11393.2015.doc

32. Mr. Sridharan explains to us as to why at Hyderabad this warheads cannot be fixed and fitted. The factory is in a civilian area. In terms of the Explosives Act, 1884 and its appurtenant rules, the warhead has to be, therefore, fitted at Nagpur. For that purpose, the canistered missile is transported to Nagpur facility of the petitioners for insertion of warhead. Mr. Sridharan has pointed out orally as also by a written note as to how after the missile is brought for fitment of warhead that insertion or fitment is done within a period of three to four days. After re-canistering, testing is undertaken on the missile, which lasts for three to four days. This re-canistered missile has a life span of approximately 10 years. Mr. Sridharan submits that out of the total missiles assembled at the Hyderabad facility, about 15% of the missiles are practice missiles, which do not carry the warhead. 5% of the missiles are technical missiles, which are not fully assembled and which are used for electronics testing and other research purposes. The remaining 80% missiles are Combat Missiles containing warhead and ready for deployment in a combat. Both the Practice and Combat Missiles are supplied to the Armed Forces. Mr. Sridharan submits that the cost of the missile is approximately Rs.25 crores in total subject to the currency exchange rates. Of this, the cost of the warhead procured is approximately 65 lakhs, namely, 2.6% of the total cost of the J.V.Salunke,PA Judgment-WP.11393.2015.doc missile. After explaining the process of despatch of the missile, Mr. Sridharan would submit that as all the sales have been effected from the Petitioners' manufacturing unit located at Hyderabad and in view of the peculiarity and sensitivity of the goods involved, the missile completed in all respects had been dispatched to its Nagpur unit for warhead integration and with clear subsequent instructions by PDI-JRI Program Note to dispatch the said missiles after warhead integration to the concerned unit of the Indian Armed Forces. Till such time the Nagpur branch would have no knowledge to whom the missile is to be sent. The Petitioner has treated the said transactions as inter-State sales of Missiles effected from its Hyderabad unit and accordingly charged and collected CST @14.5% and paid the same to is assessing authority namely the Assistant Commissioner (CT) (LTU), Saroornagar Division, Hyderabad, (earlier united State of Andhra Pradesh). However, in respect of Warhead integrated Combat Missiles supplied to the Indian Navy Unit located at Vishakhapatnam, relating to the second contract, the Petitioner charged and collected APVAT @ 14.5% and paid the same to its assessing authority namely the Assistant Commissioner (Ct) (LTU), Saroornagar, Division, Hyderabad (earlier united State of Andhra Pradesh), the third respondent herein. There is no dispute with respect to the same. The impugned assessment J.V.Salunke,PA Judgment-WP.11393.2015.doc order also records the fact that CST has been paid in the State of Andhra Pradesh.