S.L. Subramanya, CTM - (1.) THIS appeal filed under Section 22(1) of Karnataka Sales Tax Act, 1957 (for brevity the 'Act') is directed against the appeal order passed by the Joint Commissioner of Commercial Taxes (Appeals -4), Bangalore (for brevity, 'FAA') bearing No. KST/AP.67/2009 -2010, dated 30 -11 -2012 for the assessment year of 2004 -2005. The appeal was dismissed by upholding the order passed by the Deputy Commissioner of Commercial Taxes (Investigation), Bangalore (for short, 'AA') on 8 -9 -2009 under Section 8A(5)(a) of the Act. The brief facts involved in the appeal are stated thus: The appellant -a public limited company, is engaged in the business development of software and sale of software products. It is registered as 100% EOU under software technology park scheme. As per the Government Notification No. FD 314 CSL 2001, dated 26 -7 -2003 (for short, 'Notification'), the appellant had made purchases of computers without paying tax, but however, in compliance to the above notification. The AA observed that the computers are not machinery eligible for tax exemption as per the above Government Notification. Consequently, he levied tax as contemplated as per Section 8A(5)(a) of the Act on the ground of contravention of the notification and also levied penalty equal to the amount of tax levied by him as per the above provision. The matter was carried in appeal before FAA who gave his findings at para 13 in the appeal order passed by him by concurring with the view of the AA. In consequence thereof, the appeal came to be dismissed.
(2.) THE appeal order of FAA is impugned in the present appeal. It is alleged that the lower authorities have wrongly understood the nature of commodity of computers as not being machinery and thereby negated the benefit of the notification available to the appellant without justification and in addition, levied maximum penalty equal to the amount of tax levied though there was no mala fide intention in claiming the benefit of notification to which the appellant was legally entitled. Accordingly, the appellant submits that the orders of lower authorities are legally erroneous and unjustifiable. It has further pleaded to set aside these orders and allow the appeal. We have perused the records, heard the learned Counsel for appellant and the learned State Representative. The Counsel for the appellant restated the grounds urged in the appeal. The learned State Representative defended the orders of lower authorities for the reasons recorded by them in the said orders. He has sought to dismiss the appeal.
(3.) IN view of the grounds urged in the appeal, the following points arise for our consideration: Point No. (1): From the facts and law, are the orders or lower authorities proper and just? Point No. (2): What order?;