Sai Durga Rice Industries vs. The Assistant Commissioner (S.T)

Held

The Court allowed the writ petition, following its previous order in W.P.No.45971 of 2018. The assessment order passed by the 1st respondent, which levied GST on the value of by-products (broken rice, bran, and husk) by treating them as part of the consideration for custom milling of paddy, was set aside. The Court reasoned that since the petitioner's case was squarely covered by the precedent, the assessment order was unsustainable. However, the Court clarified that the petitioner remains liable to pay tax on the sale of these by-products if they are statutorily taxable. No costs were awarded. The operative direction was to set aside the impugned assessment order.

Facts

The petitioner filed a writ petition challenging an assessment order passed by the 1st respondent, which levied GST on the value of broken rice, bran, and husk. These by-products were obtained by the petitioner from the custom milling of paddy. The petitioner contended that the issue was covered by a previous order of the High Court in W.P.No.45971 of 2018, dated 20.11.2020. The learned Government Pleader for Commercial Tax, representing respondents 1 to 3, did not dispute this contention. The 4th respondent was represented by the learned Assistant Solicitor General of India.

Key Issues

1. Whether the assessment order passed by the 1st respondent, levying GST on the value of broken rice, bran, and husk obtained from custom milling of paddy, is legally sustainable, considering the prior order of this Court in W.P.No.45971 of 2018? (Question of law). Petitioner's contention: The subject matter of the writ petition is squarely covered by the order passed by this Court in W.P.No.45971 of 2018, dated 20.11.2020, and therefore, the same relief should be granted. Revenue's contention: The learned Government Pleader for Commercial Tax did not dispute the petitioner's submission that the matter is covered by the previous High Court order.