SILPA FLOORING SUPER MARKET Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) AGGRIEVED by the orders passed by the Appellate Deputy Commissioner (CT), Hyderabad Rural Division, Hyderabad in Appeal No. R/81/2006 -07, dated 21 -8 -2006, the present appeal has been preferred. The appellant is M/s. Silpa Flooring Super Market, Kukatpally, Hyderabad. It is an assessee on the rolls of Commercial Tax Officer, Hydernagar Circle, R.R. District. The Assessing Authority passed final assessment order of the assessee for the assessment year 2002 -03 under APGST Act. The Commercial Tax Officer levied tax on the turnover relating to marbles @ 12%. It is observed by him that as per the profit and loss account, the assessee spent Rs. 5,70,000/ - towards laying charges which is 4.30% of sale value of Rs. 1,32,51,972/ -. It is further observed by him that the labour component is negligible compared to the material volume of 95.70% by observing that the assessee camouflaged the sale transaction into works contract to pay only 4% tax instead of 12%. He levied tax at 12% on Rs. 1,01,05,065/ - and Rs. 31,46,907/ - relating to the periods upto 14 -2 -2003 and from 15 -2 -2003 respectively.

(2.) BEFORE the Appellate Deputy Commissioner the appellant canvassed that the said turnover does not represent the sale of marbles but it is a works contract undertaken by the appellant while dealing with marbles. The appellant also filed L1 certificate, which permitted the appellant to pay tax under composition under Section 5 -G of the Act as the appellant has been executing works contract for laying marbles. But the Appellate Deputy Commissioner negatived the contention of the appellant and dismissed the appeal.

(3.) THE authorities below ought to have seen that so long as the permission under L1 Certificate is valid, the appellant is entitled to pay tax under Section 5 -G and the authorities cannot levy higher rate of tax, contrary to Form L1.