S.MANIKUMAR,J. - (1.) Tax Case Revision No. 54 of 2017, is filed against the order in S.T.A. No. 33 of 2011, dated 16.05.2014, on the file of the Sales Tax Appellate Tribunal (Main Bench) Chennai.
(2.) 1 Short facts leading to the Tax Case Revision are that the petitioner, Tvl. Kores India Ltd., is a dealer in Carbon Papers, Typerwriter Ribbon, Duplicate Ink etc, Chennai-02 and assessed to tax on a total and taxable turnover of Rs. 15,71,30,569/- and Rs. 7,61,32,830/- respectively, under the Tamil Nadu General Sales Tax Act 1959, for the year 2004-2005, by the Assessing Officer, vide order dated 02.06.2006. Subsequently, it was noticed by the Assessing Officer that sales turnover of toner cartridges and ink cartridges to a tune of Rs. 8,09,97,739/- was granted exemption, in the original assessment order and exemption already granted on this turnover was revoked by the Assessing Officer, for the reason that the item of toner cartridges and ink cartridges were not eligible for exemption from resale tax, as per G.O. Ms. No. 82 dated 01.07.2002. 2. 2. Aggrieved by this order, the petitioner filed W.P. No. 2229/2008 and M.P. No. 1/2008 and vide order dated 28.01.2008, a direction was given to the Assessing Officer to consider the objections filed by the dealer dated 31.12.2007 and if requested, give a personal hearing and pass final order thereafter, within a period of 4 weeks from the date of receipt of the order. 2. 3. In the re-assessment order dated 30.10.2009, the Assessing Authority, after receipt of objections from the petitioner, revised the assessment on the turnover of Rs. 8,09,97,739/- taxable at 1% under section 3-H of the Tamil Nadu General Sales Tax Act, 1959 for the reason, the item toner cartridges and ink cartridges were held as computer consumables and the computer consumables mentioned in sub item(i) of item 18 are covered, in the notification issued dated 01.07.2002. 2. 4. Aggrieved by this order, the petitioner filed an appeal before the first Appellate Authority contending inter alia that the goods, namely computer printer cartridges (Ink cartridges and toner cartridges under entry 18(1) Part B of First Schedule to the TNGST Act, 1959 and in terms of G.O. Ms. No. 82 CT (B2) dated 01-07-2002 and Vide Notification No. II(2)/CT/568/(f-8)/2002 Gazette dated 01.07.2002, all items falling under sub-item (i) of item 18, Part B of First Schedule, are exempted from the levy of tax under Section 3H of the TNGST Act. Assessee futher contended that while doing so, the Government of Tamil Nadu have made any discrimination in or among the computer parts and it was categorically stated that the goods falling under 18(i) of Part B of First Schedule of TNGST Act, 1959, are wholly exempted from the levy of tax under 3H of TNGST Act. Hence, the assessee prayed to grant exemption on this part of the turnover. In relation to the levy of penalty under section 12(3)(b) assessee contended that levy is warranted as the explanatory notes to the very same proviso states that the levy of penalty under clause (b) of Section 12(3) cannot be levied, if the resulting tax balance determined is due to, additions to the turnover as per books of accounts made by the assessing authority, without any reference to any specific concealment of turnover from the accounts; any turnover estimated by the assessing authority with reference to any specific concealment of any turnover from the accounts; assessee submitted that assessment has been made based on the turnover reported both in books of accounts and returns. Hence, he prayed for deletion of penalty also. 2. 5. After verification of records and submission made by the petitioner, the Appellate Deputy Commissioner (CT) IV (FAC), Chennai, allowed the appeal, by setting aside the levy of tax at 1% under Section 3H and also deleted the penalty under Section 12(3)(b) of the Act vide proceedings in A.P. No. 3 of 2010. Aggrieved over passed by the Appellate Deputy Commissioner (CT) IV (FAC), State of Tamil Nadu represented by Joint Commissioner (CT), Chennai (East) Division preferred an appeal before the Sales Tax Appellate Tribunal, Chennai, disputing the relief of tax under Section 3H at 1% on re-sales turnover of computer toner cartridges granted by the First Appellate Authority. The Sales Tax Appellate Tribunal vide order in S.T.A. No. 33/2011 dated 16-05-2014, allowed the state appeal, in respect of the disputed re-sale turnover of Rs. 8,09,97,739/- at 1% and there by restored the revisional order of the assessing authority.
(3.) Instant Tax Case Revision is raising on the following substantial questions of law:- "(iii) Whether the tribunal was justified in allowing a disputed turnover of Rs. 8,09,97,739/- when the Appellate Deputy Commissioner had given his finding that "computer consumables including DAT tapes, print ribbon, printer cartridge taps and computer cleaning ink. There is no separate entries for computer consumables. Computer consumables are part and parcel of computer, without consumables cannot get print out and it cannot readable. The Madras High Court (Madurai Bench) has also held that the consumables are spares of computers" (iv) Whether the tribunal was justified in allowed a re-sale turnover of Rs. 8,09,97,739/- at 1% under Section 3H of TNGST Act 1959 without appraising the contents of G.O. Ms. No. 82 CT (B2) dated 01.07.2002 and vide notification No. II(2)/CT/568(f-8)/2002 dated 01.07.2002?";