M/S. Sri Rama Krishna Rice Mill vs. The Assistant Commissioner (St)

Held

The Court allowed the writ petition. It held that the subject matter of the writ petition was covered by a previous order of the Division Bench of the High Court dated 20.11.2020 in W.P.No.45971/2018. Consequently, the impugned Assessment Order dated 29.10.2020 passed by the 1st Respondent was set aside, specifically in so far as it related to the levy of GST on the value of the by-products (broken rice, bran, and husk) by treating them as part of the consideration paid to the petitioner for milling of the paddy. The Court did not impose any costs. The ratio decidendi is that if a matter is covered by a previous binding precedent of the same High Court, the subsequent petition should follow that precedent.

Facts

The petitioner filed a writ petition challenging an assessment order dated 29.10.2020, passed by the First Respondent (authority), for the tax period July 2017 to November 2018. The assessment order levied GST on the value of broken rice bran and husk, which were obtained by the petitioner during the milling of paddy. The petitioner retained these by-products in addition to milling charges of Rs. 15/- per quintal, as compensation for supplying their own rice to the Third Respondent to make up for any shortfall in yield. The petitioner sought to set aside this assessment order and direct the Third Respondent to pay the GST liability.

Key Issues

1. Whether the levy of GST on the value of broken rice bran and husk, retained by the petitioner as compensation for milling services and for making up shortfalls in paddy yield, is contrary to law, facts, and without jurisdiction. Petitioner's contention: The petitioner argued that the levy of GST on the by-products was illegal and without jurisdiction. They contended that these by-products were retained as compensation for milling services and to cover shortfalls in paddy yield, and therefore, should not be treated as part of the consideration for milling services subject to GST. Revenue's contention: The judgment records that both the learned counsel for the petitioner and the learned Government Pleader for Commercial Taxes admitted that the subject matter of the writ petition was covered by a previous order of the Division Bench of the High Court dated 20.11.2020 in W.P.No.45971/2018. No specific arguments were detailed for the revenue beyond this admission.