BHARAT COCO COLA SOUTH EAST PRIVATE LIMITED Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) AS there was difference of opinion previously between the then Hon'ble Chairman and the then learned Departmental Member, who delivered separate judgments and as there was no third member at that time, this bench consisting of the Chairman and two Members again heard the matter and as the issues are common in all these matters they are being disposed of by this common judgment. Both the Senior Advocates Sri. C. Natarajan & Sri M.V.K. Murthy, have made elaborate and illustrative arguments on 13.02.2007, 30.04.2007, 06.09.2007 and finally on 12.09.2007 which enabled us to dispose of this matter. The brief facts of the case are as follows. T.A. Nos. 911/03, 912/03 & 1323/03 have been filed by the manufacturers. All other T.As., have been filed by the wholesale dealers. The brief facts of T.A. No. 911/03 have been referred for the sake of convenience, since the facts of all other manufactures are similar. M/s. Bharat Coca -cola South East Pvt. Ltd., Hyderabad are the registered dealers and manufacturers of aerated water and soft drinks and assessee on the rolls of Commercial Tax Officer, Malkajgiri. The assessing authority has finally assessed the appellant for the year 1997 -98 under APGST Act, 1957 (here -in -after referred as the Act), on the following turnovers:

(2.) THE Deputy Commissioner (CT), Hyderabad Rural Division, Hyderabad, who is the revisional authority has examined the order passed by the assessing authority and opined that the assessing authority erred in treating the said turnover as rentals on bottles and crates and that it is nothing but part and parcel of the value of the soft drink itself. The Revisional authority has further observed as follows. The appellants have been manufacturing soft drinks with the brand names such as Thums Up, Citra, Limca and put them in the standard bottles of 200 ml, 300 ml, and 350 ml and transport the same to the wholesale dealers in the crates housing 24 bottles in each crate, The wholesale dealers in turn sell the same to the retailers. The retail dealers sell the same to the consumers who after consuming the soft drinks return the bottles to the retailers. The retailers return the same to wholesale dealers who in turn return the same to the manufacturers and this circle continues until the bottles and crates become useless. In order to secure the return of bottles, the manufacturers have been collecting security deposits. In the chain of transactions what is sold by the manufacturers is only soft drinks and the bottles and crates are only a medium of transport to transfer the soft drinks from the manufacturers to the customer in fixed quantities. The wholesale dealers or the retail dealers do not take bottles and crates on lease. They have no say in the method of manufacturing the soft drinks or the shape and size of bottles in which the soft drinks are bottled. Thus, the revisional authority has opined that what is shown and collected as rentals is nothing but the sale value of the soft drinks and the turnover is liable to be taxed at 12% under Entry 21 of the VI Schedule to the Act. Accordingly, he has confirmed the revision. T.A. No. 912/03 also arises out of the revisional order passed by the revisional authority for the assessment year 2001 -02. Challenging the same, the present appeals have been filed.

(3.) T .A. No. 816/05: