Madras High Court
The State Of Tamil Nadu vs Tvl. Antlec Ltd on 20 December, 2021
T.C. No.50 of 2021
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 20.12.2021
CORAM
THE HONOURABLE MR. JUSTICE R. MAHADEVAN
and
THE HONOURABLE MR. JUSTICE MOHAMMED SHAFFIQ
T.C. No. 50 of 2021
The State of Tamil Nadu
Rep. by the Joint Commissioner (CT)
Chennai (East) Division
Chennai - 600 006 .. Petitioner
Versus
Tvl. Antlec Ltd
No.4/8, Appavoo Lane
Chennai – 600 013 .. Respondent
Tax case filed under Section 38 of the Tamil Nadu General Sales Act,
1959 praying to revise the order of the Tamil Nadu Sales Tax Appellate
Tribunal (Additional Bench), Chennai dated 10.04.2012 passed in T.A. No.
173/2006.
For Petitioner : Mr.V.Prashanth Kiran
Government Advocate (Taxes)
For Respondent : Mrs.C.Rekha Kumari
ORDER
(Order of the Court was made by R. MAHADEVAN, J.)
This Tax Case has been filed seeking to revise the order of the Tamil
Nadu Sales Tax Appellate Tribunal (Additional Bench), Chennai dated
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T.C. No.50 of 2021
10.04.2012 passed in T.A. No. 173/2006 relating to the assessment year 2002-
2003, by raising the following substantial questions of law:-
“1. Whether on the facts and in the circumstances of
the case, the Appellate Tribunal is right in law in setting
aside the Additional Sales Tax on the taxable turnover of
Rs.1566941/- falling under Section 7C of the Tamil Nadu
General Sales Tax Act, 1959?
2. Whether on the facts and in the circumstances of
the case, having regard to the introduction of Explanation
V to Section 2(i)(aa) of the Additional Sales Tax Act, by
Tamil Nadu Act 23 of 2002 with retrospective effect from
01.04.1993, the Appellate Tribunal is right in law in
holding that the dealers are not liable to pay Additional
Sales Tax on the turnover falling under Section 7C of the
Act?
3. Whether on the facts and in the circumstances of
the case, the Appellate Tribunal is right in law in not
considering the Explanation V to Section 2(1)(aa) to
Additional Sales Tax, which was amended by Act 23 of
2002 dated 03.06.2002 which clearly treated the total
contract value as taxable turnover and hence the judgment
of the High Court reported in 124 STC 654 shall not apply
to the present assessment year under consideration?”
2. When the Tax case is taken up for hearing today, the learned
Government Advocate (Taxes) appearing for the petitioner / State fairly
submitted that the issues raised in this case are squarely covered against the
Revenue, by the decision of this Court in State of Tamil Nadu v. Taher Ali
Industries & Projects (P) Ltd. in W.A. (MD). No. 174 of 2013 dated
29.09.2016.
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T.C. No.50 of 2021
3. For better appreciation, the relevant paragraphs of the aforesaid
decision are extracted below:
“14.It is a settled position of law that the Explanation
normally should be read so as to harmonise with and clear
up any ambiguity in the main section and it should not be so
construed as to widen the ambit of the section and also to
clarify the doubtful point in law and to serve as a proviso to
main section.
...
17.The dealer need to pay tax based on his taxable turnover
determined after allowing various deductions admissible
under law and without amending the said provision, merely
the Explanation V is added to get over the effect of the
judgment in South India Corporation Ltd v. Commercial Tax
Officer, Coimbatore and others reported in
MANU/TN/0946/2001 : 124 STC 654.
18.In the light of the judgment of the Honourable Supreme
Court in S.Sundaram v. V.R.Pattabhiraman reported in
MANU/SC/0387/1985 : AIR 1985 SC 582, this court is of the
considered view that the impugned Explanation sought to
widen the scope of taxable turnover as defined under
Section 2(p) of the TNGST Act and the learned Judge in the
impugned order has taken into consideration the well settled
position of law and held that the impugned Explanation is
contrary to the provisions of the Act and allowed the writ
petition.
19. In paragraph 19 of the judgment in South India
Corporation Ltd. v. Commercial Tax Officer, Coimbatore
and others reported in MANU/TN/0946/2001 : 124 STC
654, the Division Bench of this Court held that the claim for
additional sales tax by treating the contract value as the
taxable turnover is not permissible under the provisions of
either the TNGST Act or the Additional Sales Tax Act. The
said judgment has also reached finalty as no further
challenge has been made and therefore, on that ground also,
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the impugned Explanation is to be declared as ultra vires
T.C. No.50 of 2021
and it was rightly declared so in the impugned order passed
in the writ petition.
20. This Court upon scrutiny and consideration of the
relevant materials and in the light of the above judgment is
the considered opinion that there is no apperant or infirmity
in the reasons assigned in the impugned order in allowing
the writ petition and finds no merit in the writ appeal.
21. Therefore, the writ appeal is dismissed and the order
passed in W.P. (MD) No. 1831 of 2007, dated 27.09.2011, is
confirmed. No costs.”
4. Following the ratio laid down by the Co-ordinate Bench of this Court
in the decision cited supra, which is applicable to the facts of the present case,
the substantial questions of law are answered against the petitioner/State.
Accordingly, the tax case is dismissed. No costs.
(R.M.D., J.) (M.S.Q., J.)
20.12.2021
dhk/rsh
Internet : Yes / No
Index : Yes / No
To
1.The Joint Commissioner (CT)
Chennai (East) Division
Chennai - 600 006
2.The Tamil Nadu Sales Tax Appellate Tribunal
(Additional Bench), Chennai.
https://www.mhc.tn.gov.in/judis R. MAHADEVAN, J.
T.C. No.50 of 2021
and
MOHAMMED SHAFFIQ, J.
dhk/rsh
Tax Case No. 50 of 2021
20.12.2021
https://www.mhc.tn.gov.in/judis
