OMC COMPUTERS LIMITED Vs. THE STATE OF ANDHRA PRADESH
SALES TAX TRIBUNAL
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R. Bayapu Reddy, Chairman -
(1.) THIS appeal is filed questioning the orders of the Appellate Deputy Commissioner (CT) Secunderabad Division, Hyderabad in Appeal No. 30/88 -89, dated 13 -3 -1989 by which the orders of the assessing authority (Commercial Tax Officer, Company Circle, Secunderabad) in Assessment No. 85 -86/APGST, dated 5 -9 -1988 subjecting the disputed turnover of Rs. 1,29,41,910/ - relating to sales of electronic goods to additional tax and surcharge besides the basic tax were confirmed. The appellant is a dealer in electronic goods. During the assessment year 1985 -86 he effected sates of electronic goods covering the disputed turnover of Rs. 1,29,41,910/ - which was assessed to tax by the assessing authority at 4% besides additional tax under Sec, 5 -A and surcharge under Sec. 6 -B. The appellant preferred appeal before the Appellate Deputy Commissioner questioning the levy of additional tax and surcharge contending that in view of the provisions of G.O.Ms. No. 721 dated 1 -7 -1985 the total tax payable by the appellant shall be only at 4%, that if additional tax and surcharge are levied besides the basic rate at 4%, the total rate of tax will exceed 4% which is not intended by the Government While issuing G.O.Ms. No. 721 dated 1 -7 -1985 and that therefore the levy of additional tax and surcharge shall be set aside. The Appellate Deputy Commissioner, however, refused to accept such contention and dismissed the appeal. As such the present appeal is filed before this Tribunal. Even though the appeal was filed in the year 1989 and even though number of adjournments were granted to enable the appellant and his Counsel to be present and argue the appeal, they failed to utilise such opportunity and remained absent continuously over a long period. As such it was felt that there are no valid reasons to adjourn the matter any further and the State Representative appearing for the Department was therefore heard and the material available on record is perused and orders are being pronounced on merits on the basis of the available material.
(2.) THE point for consideration is whether the levy of additional tax and surcharge on the disputed turnover is not valid and legal? The disputed turnover of Rs. 1,29,41,910/ - relates to sales of electronic goods. It is admitted that G.O.Ms. No. 721 Revenue dated 1 -7 -1985 applies to the present case and the rate of tax shall be only at 4%. But the point in dispute is whether such rate of tax at 4% mentioned in G.O.Ms. No. 721 Revenue dated 1 -7 -1985 is only basic rate exclusive of additional tax and surcharge or inclusive of such additional tax and surcharge. The contention of the appellant appears to be, as seen from the grounds of appeal that the total tax payable by him shall not exceed 4% under the said G.O., that in case additional tax and surcharge are levied besides the basic rate at 4%, the total rate will exceed 4% which is not intended by the said G.O., and that therefore additional tax and surcharge cannot be levied besides the tax levied at 4% by the assessing authority. He also tries to rely upon some other G.Os., as well as the decision of our High Court reported in M/s. The India Fruits Private Limited Vs. Commercial Tax Officer ( : 1987 - 5 APSTJ 148), as seen from the grounds of appeal, in support of his contention. But such contention of the appellant cannot be accepted in view of the nature of the G.O. and the facts of the present case.
(3.) NOTIFICATION -II issued under G.O.Ms. No. 721 dated 1 -7 -1985 is to the following effect:
"G.O.Ms. No. 721, Revenue (S), dt. 1 -7 -1985
NOTIFICATION - -II
In exercise of the powers conferred by sub -section (1) of Section 9 of the Andhra Pradesh General Sales Tax Act, 1957 (Andhra Pradesh Act No. VI of 1957), the Governor of Andhra Pradesh hereby makes a reduction in the rate of tax to four paise in the rupee payable under the said Act with immediate effect on the sales of electronic goods as defined hereunder manufactured in the State of Andhra Pradesh and sold by the Industrial Units Manufacturing Electronic goods as defined hereunder subject to the following restrictions and conditions: - -
X X X XX X X X
The contention of the appellant appears to be that the reduction in the rate of tax to 4% granted under the said G.O. relates to the tax 'payable under the Act', that such reduction in the rate of tax is not referred in the G.O. with regard to any specific entry in any Schedule as in the case of some other G.Os. and that therefore such reduction of tax to 4% shall be with regard to the entire tax including the additional tax and surcharge payable under the Act. He also appears to rely upon the earlier G.O.Ms. No. 716 dated 27 -4 -1984 which was rescinded by the subsequent G.O.Ms. No. 721 dated 1 -7 -1985 in support of his contention. G.O.Ms. No. 716 dated 27 -4 -1984 is as follows:
"G.O.Ms. No. 716, Revenue (S) Department, dt. 27 -4 -1984.
In exercise of the powers conferred by sub -section (1) of Section 9 of the Andhra Pradesh General Sales Tax Act, 1957 (Andhra Pradesh Act VI of 1957) the Governor of Andhra Pradesh hereby directs that with effect from 1st April, 1984 the tax leviable under clause (a) of sub -section (2) of Section 5 read with Item 38 of First Schedule to the said Act, shall be at the reduced rate of four paise in the rupee in respect of sales of "Electronic systems, instruments, apparatus, appliances including electronic cash registering, indexing, Card punching, franking and addressing machines, computers of analog and digital varieties, one record units, oscilloscopes and other electronic, equipment and material and parts and accessories thereof".
The contention of the appellant appears to be that in G.O.Ms. No. 716 dated 27 -4 -1984 a reference is made to the tax leviable under clause (a) of sub -section (2) of Section 5 read with item 38 of First Schedule while such reference to any Schedule or any provision of the APGST Act is not made in the subsequent G.O.Ms. No. 721 dated 1 -7 -1985 and that therefore the rate of 4% contemplates under G.O.Ms. No. 721 dated 1 -7 -1985 can be said to include the additional tax and surcharge also. But such contention cannot be accepted in view of various circumstances as to be discussed below.;
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