M/S. Sri Venkata Balaji Modern Rice Mill vs. The Assistant Commissioner (State Taxes)
Held
The Court allowed the writ petitions, following its previous order in W.P.No.45971 of 2018. The assessment orders 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, were set aside. The reasoning is that the issue is covered by the precedent. The Court clarified that the petitioners remain liable to pay tax on the sale of these by-products if they are statutorily taxable. The ratio decidendi is that by-products of custom milling, when not part of the consideration for the milling service itself, should not be subject to GST as part of the milling service value, unless they are independently taxable upon sale. The operative direction was to set aside the assessment orders.
Facts
The petitioners filed writ petitions challenging assessment orders passed by the 1st respondent (authority not specified, but implied to be a GST authority). These orders levied GST on the value of broken rice, bran, and husk, which were obtained by the petitioners as by-products from custom milling of paddy. The petitioners argued 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 Government Pleader for Commercial Tax, representing the respondents, did not dispute this contention. The Court was therefore asked to pass a similar order.
Key Issues
1. Whether the GST levied on the value of broken rice, bran, and husk, obtained as by-products from custom milling of paddy, is valid, considering the precedent set by this Court in W.P.No.45971 of 2018. Petitioner's contention: The subject matter 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 should be applied. Revenue's contention: The learned Government Pleader for Commercial Tax representing the respondents did not dispute the petitioner's submission regarding the applicability of the previous order.
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HON'BLE SRI JUSTICE U. DURGA PRASAD RAO AND HON’BLE MS. JUSTICE J. UMA DEVI
WRIT PETITION Nos.770, 801 AND 852 of 2021
COMMON ORDER: (per UDPR,J)
These batch of writ petitions are filed challenging 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 Srinivasa Rao Kudupudi, learned Government Pleader for Commercial Tax representing on behalf of respondents 1 and 4, Sri P.Hema Chandra, learned standing counsel representing on behalf of respondents 2 and 3 and learned Assistant Solicitor 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.
Following the above said order and for the reasons rec
The judgment continues below.
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