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… APPELLANT
‘:*3y~s;~:]- “M’AI_, 1 mt), ADV. mr'”AR’1’I»–1.r\sARA’rr~I1)
AND’:
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VANIJYA ‘I’I-HSRIG 115 KARYAI.-/\”‘2.’A A ~ ‘
GANm«-IENAGAR dNDIa:N’rs
(By Sm_1:: Gf3E’i’%–I MI-ZN()N#. .,*-“ff ;-iV\.I3_.7\:/_C:(‘–/’.?”~\;I”f_’I;7)
STA F1:,i3:1’3 1:713/.35 (.1) ()1-7 ;TP1:+::”‘1{s”r ACT AGAINST
THE ORDER ‘1:>A”r”1%:1._>:’ P!-XSSISI) IN NO.ZAC-
1/DVG/SMI{»v.l.?”-/$5.-O6; 1f1*;;3_9_9/G8-09 ON ‘rm: FILE 0}?
THE Ai._’)’r5’L.’c..<f;+iMMi3$Szc)'r«I.,;§i2 O15" COMMEZRCIAI. TAXES,
ZONE» I–3ANr.;.Am£§I:;._ I-3e1:z:_vis1';\§c 'I'f-iii) ORDER 01+' APPEAL
AND sr'§'–:fr1N<3- –ASi:jj)'~1::'":r1§I"»»«.r=:a1'e:c;Ar'21) TO ISSUE UNDER
RI£\/ISf()N "A_1§:1_::_ A(:.:_;1i;vc;1_.v Rf£S’I’ORING ‘f’I~H.%3 ORDER
OF ASSICSSMI’-:Nf1′ ‘1vNv’mi:.ct’I’ 01? ISSUE UNDI-ER REVISION
_ AND»’l4Uf)INC’f'{jIj”1_1{T’ RI_.CVISIONAI.. PROCEEDINGS.
V _ ‘V”f?I”1_iE5»..;;i;;§’fic;=’;§ :;:'()n1img on Ibr l’me”x:”i:’1g {ms dz-1y. Ma:y’z.mai’}’1
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JU£)C}MI*LN’I’
–‘}’f1c:. Iege1}iI}-‘ z-1r1c.i {*(.):”:'<*. mdezr passed under
‘VAS.e~:f::.i():1 22~A(ij of’ the KS’? Am. 1957 pzzzesscéci by the Addi.
“Cc>:’11z11issi<)ner 01' (31’1e~E.. I”3£:U’1g&1lOf'(3
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2. The facts leading to this ease are hereunder:
The appeiianbassessee is a civil e0r1t1*a1c:t.c;r.”
assessment year 1998–99. it filed i”1’1e'”returri.’ ofviuri’eo’ne1e
paid the Sales Tax payabie L1E1C§«C1′::__tTlti’ 1I:;i*oVi.sio&i1si_i”‘~.oi’7–i
Karnataka Sales Act. ..wo1’kh
contractor, it has b€6I’1f the
provision of Section 58 of return filed
by the assessee, €’3;E”.i’11pti:(.;’i”i”vR.fE’:a:S’ the Assessing
Officer in parts purchased
by the a1HpiV:>eii«ayii-1 t1S€C1 by him for the
€XC£?E1i,i(i1:i of aggrieved by the order of
the Assessirigi Oi’fiee’i’.VA’t1aiee1’4Ji3.1.2.2OO-4. he preferred an
appeaji’ ‘be:fore ti’ie_JoiI1t “Commissioner of Commeroiai Taxes
fiav.a1’1ge1*e Division, \\;10li(_’.h appeal came to be
Aatiowecfi ;g1″ant:ir1g relief to the appellant herein.
‘E’here__aft.evr’ the Joint Commissioner oi” Coimnereial Taxes
V’C*:XACI7’CiSi1’ig the S110 mote powers vested in him uiider Section
of the Kamatzlka Sales Tax Act, 1957. issued a
, yshioxvwcause notice to the apijeiiaiit herein. AC(Z()I’di1}§,f1y, the
appellant submitted his repiy and i:hereafter the Add}.
Commissiorier eame to the eonelusion that the Apex Court in
the ease oi” Garinozi Dzmlcerly <82. Co. 8:, Others V/s. State of
e§~;/
Rcy'c:zsIl'1ar1 8:. Others (1988 SEC 204 (SC) has not granted
CXCITIDUOII in regard 1.0 the spare parts purchased "sin
assessee and 1.he1-efore. came to the eoheiusion_….1_ha.1:"tljxev".
Order passed by the Joint Commissioner of 'C.r)n1éjf1er'ctie:1TI*-.T
Taxes I')av3.r1ge1'e, is prejudicial. 10 me' i:1t'e're3'£701'-1i'h.e_"Re<ze1iu(:
and modify the order passed_ by the 1'a13pekk21.i,_e aL1t}1e;;it.y '
thereby restored the order passhezjhby the 'ASses:$:i11Vg.%Officer.
Challenging the same. ti3e.p1"eseh"felgjpeaii» filed."
3. Learned counsel fer .em”.1’_ae11ds that the
Addk. C0n1missi0ne1f of C’tiit’:’m1:V-;21’eie1’1″e,Tax)Ifafied to note than
the h1a<;:#11ir1e'1'ieé» _VL1se'd b_yh'1.hc appekkant was to execute its
work a1r1duas= a1'1dv\§\;*he:f1"t,-heepare pans were worn out on
'r1CC0Lm_i_ of the £L~3r:: of 1'1j1ae'hine1*y while executing the work
JV'Rontfgiet;_–ziejee(:ted i.(5"'"re;jia(:e the maehineries had suffered
Esaelee zi"1jes'1t11 of which he is en1.it.1ed for e.,xempt,ion as
p1"<A)\;*iV'.é'j_<1hs 01'Seeti()n 5{l-3} of the KS'? Act.
~'+'.n j }–ei(='v.§{1r'i.l1e:21' ('01'11emis 1,1121%. the Addl. C()ITII'}'1iSSi()11C1' 11218
_ iL1ii'csfi_.t:<) note Eliatf the word used in Clause 'I3' 01' the order
.. by the Apex Court in G-armon Dunkerly & Co.
VV Olhers ‘W SI.a.1.e Qf I’€cy’as3i:han Oifihers with 1’ega1′(‘1 1.0 grarfi
of exemp1.io1’1 i1’1(.’.1u(ies éhe e1’121:’g:?5 for 0btaihi11g 011 hire 01′
othexwise machinery and toois used fo:’ the exeeL1tio:’1 of the
works e.:i)nt.1’aCt and that the Add}. Commissioner withtout,
following the judglnem of the Apex Court. h21s3«~~–.V\f1<i)_i"i'§,i}£A'
dis:a11()we<i the exemption gr2:1nt.e<:i by the A1)pe.1V1_a't'e.uAut.hori'! *
in favour of the assessee. Therefore._Che feqgtests-:t}3e"eouftto
set, aside the order passed by the Add};__CommisSV1_o;1er '-3n'=.'th'et
ground that. the same is eon't'ra1*y–«.t,othe [31°(7viVs'to1_is o'{Se"ct.ion
5(8) of the KST Act'.. V e
5. Per contra learned.C:oVern:.1f1erit:–Acytvoeate supporting
the order of the C0mmissiex1,eI*.subrnits”t.l1é(t ltiite judgment” in
the s21idVh(éase’t’d<§»:;}s xiieritizo the exemotion that the spare parts
purchased for trhe" A:1_t'1~1.t:i'(3}1__iVi*ie;*j. AC(:01'di:r1g to him' even
thougl"; the xtforclvia .L1Sed"v;its"eh21rges for obtaining on hire or
«-ot.I1e-ifykiise—e.n1achinery'"ar1'd tools used for t.he execution of the
"'.\VG'1'kS'_C'(;.I]t.172i4(?{:7Vi'E1(3}E,id(i the purchase made for the spare
pa.1iA£".sh'oi" the'Vh;2£e11ine1*y owned by the zlppellant. 'I'herefo:'e.
tveshe reques._t.s the court. to dismisss the appeal.
" re._Aft,er hea.ri1'1g' panies. we are of the View that the
_t~__Iear':"1ed Addl. Commissioner has c:ommilt:ed an error in
" '1"1o}ding that the Order 01' the appellate aL.1t:ho1'it'.y
1I)}'(_'._EU.diCiE11 to the i1'1t.e1'est. of the }'C\/€3.1'1L.}C in g:'2.tnE'i:1g
$Yf
"(V
exemption in respect of the value of the spare parts
purchased by the appeitant for its maehineries f'()Ef"u'{:11€
foliowi 11 reasons.
7. It is not in dispute that niaehine1’y
appellaint has been used For the exee.u’I:i’0:1 of txzn._c}:.–:1″7.,
taken by him as a Civil e0:1tra(7t01′.3 ‘i:’.*.1e”mac:hi’11.e1’ies’
purchased by him for CX(3CL}.UC)l1_ “(J~1.’V the .VVOl”i{._ A-s when
the spare parts of the mgtchine1fi_es:a.1fe*~w01″r1 Ou–t.V_Qn_i3.ceount
of its regular use, the”::issesLsee{,a15’peiiiginii. is bound to
13LEI’Ch£1S€ the spateVpa1’ts”‘é11i–Ci”ge’i._t*he 1i’::;1e’iir1e1’i<3s repaired
for eXee;t1t4ic)11heijfthe :u\:.V?t!'L)i'.1'{'..".J.I"t. is in dispute that the law
provides for g1'a:':'i. Of :exei11_pti{)ri if any machinery is hired or
hire ei1_ai'ges*:'11*e.paid'=_t0'" the owner 01' the maehineries.
«..I_11ste,2_1t1 Qflé-tvkiflg E.h€'I"'1'i'iEtChiI1€1'i€S on hire from 21 third party
'if i;1'17€'2"CQi'i1',i'.EiC}L0VI'v himself has purchased the rmitehinery and if
sp9ar'e"pa:*t'.s"are':required to be pui*ehz§.sed on account 0!" its
sensual wear and tear. We ztre of the opinion that the assessee
aV1sQe11i'.ii';1ed {.0 Claim exemption on the value of the spine
' lvairts purchased by the assessee since the same is used for
the macéhineries owned by it and it" such pu:"<pizii1z1ti.0i'1 to the Rule ('3[4}{1i1}{4»} of t.1'l(-2
av"
K:;11’n2112.1ka Sales Tax. 1957 will 2.1130 €1’1L1I’€ to the be1’1e1’it of
the to claim ex’ernp1′.i01’1 as Ehe I}]’dCI’1i11€1’iC’S ‘c}1v’v€ ‘\1_$’Q(i
for {he ex.ecui.i0n Oi’ the work. Under the Cir(:L11nsta’11{1¢s…__L’\=é9Q_
are of the View that the Add}. Comlmssioner ()f..’3.€;1_’é:»$ ;Fa1§; }_1’c’:S”
c01’I’11″r1iE’:1.e3d a serious error in z111()\vi1′;g thfif ‘E-3′:’.,1G._1TV1′(‘JIO__ 14″t_~’.3x’i.$iV()’1j_ A’
petition Lllldfii” Se.C.t’i01’1 52{A) of {ht I-\(tt;* ‘ _ . Av ‘
8. Accordingly. this appeal–.,_jé”~.V_Az1II()\Vcd ‘3.VVlA1Ci: i”ir–1é”” u1*de1″
by the Add1.. C01’n.n’1issi<)V1'V1e~:*;6§7.Sé1.I¢s Ta}; 'ivs..hVei:eby set
aside.