The State Of Ap. Rep.By State Represntative Before Stat vs. M/S Pushkar Appliances Limited, Secunderabad.
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The State of Andhra Pradesh, represented by the State Representative, filed a tax revision case challenging an order passed by the Sales Tax Appellate Tribunal (STAT) on March 2, 2009. The dispute concerned the exemption from sales tax for voltage stabilizers purchased by M/s Pushkar Appliances Limited from M/s Sannihita Electronics Women's Welfare Cooperative Society. The assessee claimed exemption under G.O.Ms.No.533 dated April 1, 1984. The Commercial Tax Officer initially denied the exemption, but the Appellate Authority allowed it. However, the Revisional Authority reversed this decision. The STAT, in turn, upheld the exemption, finding that the goods were manufactured by a Women's Welfare Industrial Cooperative Society, which was the sole criterion for exemption as per the G.O.
Held
The Court held that G.O.Ms.No.533 dated 24.03.1984 provides exemption from sales tax for products manufactured by Women's Welfare Industrial Cooperative Societies. The G.O. does not restrict the exemption only to sales made by the societies themselves. The plain reading of the G.O. indicates the government's intention to promote products manufactured by these societies, and it does not specify that the sale must be carried out by the cooperative society to qualify for exemption. The Court agreed with the STAT's interpretation that the exemption is general and covers all products manufactured by such societies, irrespective of who sells them subsequently. Therefore, the question of law was answered against the petitioner (State) and in favour of the respondent (assessee). The tax revision case was dismissed.
Key Issues
1. Whether G.O.Ms.No.533 dated 14.01.1984 provides exemption from payment of sales tax to products manufactured by Women's Welfare Industrial Cooperative Societies alone, or also to dealers who sell products manufactured by such societies? The petitioner (State) argued that the exemption was limited to products manufactured by the societies themselves. The respondent (assessee) contended that the G.O. exempted all products manufactured by these societies, regardless of whether they were sold by the society or by a subsequent dealer. The respondent relied on the wording of the G.O. and the intent to promote these societies. The petitioner did not record any specific arguments beyond the interpretation of the G.O.
Sections Cited
Section 112(1), Section 9(1)
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Cause title — parties, addresses and appearances
The Court delivered the following : Judgment
THE HONOURABLE SRTJUSTICE P.SAM KOSHY AND THE HONOURABLE SRI JUSTICE SUDDALA CHALAPATHI RAO TREVC No.183 OF 2009 JUDGNIENT: Oar Hon'ble Sri Justice P.Sam Koslry) Heard Mr. T. Chaitanya Kiran, Ieamed r\ssistant Govemment Pleader representing Mr. Swaroop Oorilla, leamed Special Govemment Pleader for the State Tax for the petitioner and Mr. Shriraj, learned counsel representing R.S. Assrtc:iates for the respondent. I)erused the record. 2. 'l-he present is a tax revision case under Section 112:( l) of the Andhra Pradesh Goods and Services Tax Act, 1957 preferrcd by the State. The challenge is to the order passed by the learned Sales Tax Appellate -l'rihunal (STAT) in Tribwral Appeal \o.l-i88 ol 200i. decided on 02.03.2009. 3. -[he question of law raised by the State while as:;ailing the order ol the leamed STAT is whether G.O.Ms.Nc,.:il3 dated 14.01.1984 provides exemption from payment of sales tax to products rnanuf-actured by the Wornen's Welfare lndustrial
2 Cooperative Societies alone or even to the dealerS who sells products manufactured by such Industrial Cooperative Societies.
For better understanding, it would be relevant to take note of the contents of the GOMs which is the bone of contentlon in the instant tax revision case. 'ln exercise of the powers conferred by Section I of APGST Act, 1957, (Andhra pradesh Act Vl of 1957), the Governor ofAndhra pradesh hereby exempts the sales of all products manufactured by the Women Welfare lndustrial Cooperative Societies in the State from the tax payable under the said Act with effect from 01.04.1984"
The respondent/assessee ts IN l'act, on the rolls of the Commercial Tax Department and is a dealer ol sale ol voltage stabilizers. He has purchased the stabilizers ftorn M/s Sannihlta Electronics Women's Welfare Cooperative Society. The assessee had claimed exemption of payment of tax under the ApGST law in terms of the afore referred G.O.Ms.No.5ll dated 24.B.l9g4 The Commercial Tax Oflicer initially had refused ro granr exemption to the petitioner. However, on an appeal, the Appcltate
FIF'I-_---"-- 3 Authority had allorved the appeal vide order dated 17.03.1999. However, the same was reversed by the Revisional Authority vide order dated 10.03.2003 restoring the order passed by the Commercial Tax Off-rcer. However, on an appeal preferred by the assesssee before the learned STAT, the Appellate Tribunal reversed the order ol the Revisional Authority upholding the c,rder of the Appeltate Authority.
What is undisputed in the instant case is the frct that the respondent/assessee is a dealer in the business of sale ol stabilizers. It is also undisputed that the respondent/assessee sell; stabilizers which he purchase'd from M/s Sannihita Electronics Women's Welf are Coopcrative Society. [n terms of the sale of the stabilizers manulactLrred tiom the afore-mentioned Women's Wellare Society, the Society had clainred tbr exe.mption and which is the point of issue in the instant tax revision case also. The leamed STAT referring to the contents of the GO and reversing the order of the Revisional Authority has rvhile deciding the issue held as under: "A reading of the above GO indicates that the goc,ds if they are manufactured by Women's Welfare lnduslrial Cooperative Societies, they are exempted from pdymenr of 4 sales tax under APGST Act. The only rider for claiming exemption under the Act is that the goods must be manufactured by women welfare industrial cooperative society. The GO does not say that the goods shall be manufactured and sold by women welfare industrial cooperative society. lf really the contention of the learned State Representative is to be taken as true, the GO will be worded as follows: "The Govemor of Andhra Pradesh hereby exempts the goods manufactured aN sold by women weffare industrial coo pe rativ e societies". But the above wording has not been employed by the Govemment while issuing the said GO under Section 9(1) of APGST Act. Probably in order to encourage the Women Welfare lndustrial Cooperative Societies, whatever the goods they manufaclure are accorded exemption of sales tax, whether they urere sold by women welfare industrial cooperative society or for any other subsequent dealer. One cannot expect the goods manufacture by these societies can stand the cornpetition for the goods which are being manufactrred by reputed companies such as Voltas, Uni-Stab, V-Guard voltage stabilizers etc., Hence, it seems that to encourage this Sannihita Electronics Women Cooperative Society or such like other Women Welfare lndustrial Cooperative Societies, the Government issued a general GO covering all the goods that are being manufactured according sales tax exemption, whenever they are marketed by any @aler in the open market. Therefore, we are of the opinion that it is a general GO issued by the Government granting exernptbn for all the products manufactured by the \Abmen Welfare lndustrial Cooperative Societies whether they are sold by such society or by any 5 other dealer from payment of sales tax. The order passerd.by the Addrtional Commissioner clearly indicates that admittedly these voltage stabilizers are manufactured by Sannihita Electronics Women Cooperative Society Thereforr:, in pursuance of GO.Ms.No.533 Revenue, dated 24-3-1984' the appellant is entitled to claim exemption from payment of sales tax on the sales of these voltage stabilizers
Accordingly this issue is found in favour of the appellarrt and against the revenue".
Coming thc rvordings of G'O.Ms.No.533 dated 24'03'1984 as has been rightly discussed by the leamed STAT, what is indicated is only granting excmption to the products manufactured by the Women Wettare Industrial Society. The GO does not in any manner restrict the eft-ect of the said GO to *re W'lmen Welfare Industrial Coope rative Societies alone but also covers the sale rnade by cvcn dcalers as rvell or else it would had been specifically dealt with in tlre GO itsclt-. t'he GO, on the plain reading, gives a clearly indication ot' the intcntion of the Govemm()nt to promote thc products uranttlitctured by thc Women Welfare Industrial Cooperative Socictics. Norvhere does the GO also indicates that apaft lrom nranr,r f'actut'itrg thcse products, it is the r'esponsibility o[ the said Cooperltivc Societies alone to have also carried out the salc so its t() gct thc cxetttption. ln the absent;e of any such 6 indication in the GO and the GO being a general GO granting a general exemption of all products manufactured irrespective of the agency who sells it, be it a dealer, be it the society themselves, such products would stand exempted from payment of sales tax under the APGST Act. In view of the same, we are also o[ the considercd opinion that the opinion arrived at by the learned STAT is proper, legal and justified and the question of law stands answered against the petitioner/State and in favour of the respondent/assessee. 8 The tax revision case fails and is, accordingly, dismissed l'hcre shalI be no order as to costs. Cor.rscquently, miscellaneous petitions pending, if any, shall stand closed. . N SRIHARI PUTY REGISTRAR //// S TION OFFICER 1 . The Sales Tax Appellate Tribunal, Andhra Pradesh, Hyderabad(With records, if any) 2 Two CCs to SRI SWAROOP OORILLA, SPECIAL GP for the state tax, High Court for the State of Telangana at Hyderabad (OUT) 3 .One CC to Sri Shriraj, Advocate [OPUC]
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HIGH COURT DATED:0611012025 JUDGMENT TREVC.No.183 of 2009 DISMISSING THE TREVC WITHOUT COSTS C ---:'.=':- ::-.-- iti ,'t-1 \:,, 1 i li['{ ir-liq \.'., \it , @A 1t' q $ I
Reproduced from the public record of the Telangana High Court. Verify against the court's own copy before relying on it. Income tax judgments are on bharattax.net.