M/S. Sri Viswakiran Industries vs. Assistant Commissioner Of State Tax
Held
The Court allowed the writ petitions, setting aside the appellate orders passed by the 2nd respondent and the assessment orders passed by the 1st respondent. The Court reasoned that the matter was squarely covered by its previous order in W.P.No.45971 of 2018, dated 20.11.2020. The principle derived from this decision is that by-products of custom milling, such as broken rice, bran, and husk, should not be treated as part of the consideration paid for the custom milling service for the purpose of levying GST, unless they are statutorily taxable on their own sale. The operative direction was to set aside the impugned orders. The Court clarified that the petitioners remain liable to pay tax on the sale of these by-products if they are otherwise statutorily taxable. No issue was expressly left undecided.
Facts
The petitioners filed writ petitions challenging appellate orders passed by the 2nd respondent, which confirmed assessment orders from the 1st respondent. These assessment orders levied Goods and Services Tax (GST) on the value of broken rice, bran, and husk. These by-products were obtained by the petitioners from the custom milling of paddy. The petitioners argued that the subject matter was covered by a previous order of the High Court in W.P.No.45971 of 2018, dated 20.11.2020. The Government Pleader for Commercial Tax did not dispute this assertion. The dispute concerned the taxability of these by-products as part of the consideration for custom milling.
Key Issues
1. Whether the by-products of broken rice, bran, and husk obtained from custom milling of paddy are to be treated as part of the consideration for the custom milling service, thereby attracting GST, as held by the 1st and 2nd respondents? Petitioner's contention: The issue is squarely covered by the High Court's order in W.P.No.45971 of 2018, dated 20.11.2020, and therefore, the impugned orders levying GST on the by-products should be set aside. Revenue's contention: The Government Pleader for Commercial Tax did not dispute the petitioner's submission regarding the applicability of the previous High Court order. Therefore, no specific argument was recorded for the revenue on the merits of the taxability of the by-products.
AI-generated summary — verify with the full judgment below
HON'BLE SRI JUSTICE U. DURGA PRASAD RAO AND HON’BLE MS. JUSTICE J. UMA DEVI
WRIT PETITION Nos.3878 and 3888 of 2021
COMMON ORDER: (per UDPR,J)
These writ petitions are filed challenging the appellate orders passed by the 2nd respondent in confirming the assessment orders passed by the 1st respondent levying GST on the value of broken rice, bran and husk obtained by the petitioners on custom milling of the paddy.
Heard learned counsel for petitioners, Sri K.V.J.L.N.Sastry, learned Government Pleader for Commercial Tax representing on behalf of respondents 1 to 3, learned Assistant Solicitor General, representing on behalf of 4th respondent and Sri P.Hema Chandra, learned standing counsel representing on behalf of 5th respondent.
When the matter is taken up for hearing, learned counsel for petitioners would submit that the subject matter in these writ petitions is squarely covered by the order passed by this Court in W.P.No.45971 of 2018, dated 20.11.2020 and the same order may be passed in these writ petitions also. Learned Government Pleader for Commercial Tax representing on behalf of respondents has not disputed the said fact.
Followi
The judgment continues below.
Read the full judgment
A free account opens 10 full GST judgments a month (one account works on both bharattax.net and this site). Re-reading one you have already opened does not count again.
The summary, the parties, the sections and the citations above are open to everyone and always will be. Only the text of the order and the PDF are metered.
Reproduced from the public record of the Andhra Pradesh High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.