State Of Kerala vs M/S.Sigma Inc on 6 September, 2010

       

  

  

 
 
  IN THE HIGH COURT OF KERALA AT ERNAKULAM

ST.Rev..No. 175 of 2008()


1. STATE OF KERALA, REP. BY JOINT
                      ...  Petitioner

                        Vs



1. M/S.SIGMA INC, PALARIVATTOM
                       ...       Respondent

                For Petitioner  :GOVERNMENT PLEADER

                For Respondent  :SRI.VIJAYAN. K.U.

The Hon'ble MR. Justice C.N.RAMACHANDRAN NAIR
The Hon'ble MR. Justice K.SURENDRA MOHAN

 Dated :06/09/2010

 O R D E R
                                                                                   C.R.
                    C.N.RAMACHANDRAN NAIR &
                         K.SURENDRA MOHAN, JJ.
               ....................................................................
                           S.T. Rev. No.175 of 2008
               ....................................................................
               Dated this the 6th day of September, 2010.

                                      JUDGMENT

Ramachandran Nair, J.

Question raised in the revision filed by the State is whether

speaker sold by the respondent for fixing in cars attract sales tax at 12%

under Entry 134 of the First Schedule providing for Sound transmitting

equipment including Loud speaker or Electronic goods under Entry 55

of the K.G.S.T. Act. We have heard Government Pleader appearing for

the petitioner and counsel appearing for the respondent-assessee. The

assessment involved is for the year 2003-2004. The assessee is

engaged in sale of car stereos along with speakers and car stereos and

speakers separately. For the sale of stereos and sale of stereo with

speakers, the classification applied by the officer is as electronic goods

under Entry 55, on which tax is levied at 8%. However, for

independent invoices covering sale of speakers, the Assessing Officer

applied the rate at 12% provided in Entry 134 which covers sound

S.T.Rev. 175/2008 2

transmitting equipments including loud speakers. The Tribunal,

however, held that speakers are also electronic goods assessable under

Entry 55 at 8% as claimed by the respondent, against which revision is

filed by the State.

2. The relevant Entries are the following:

————————————————————————————-

Description of goods Point of levy Rate of tax

————————————————————————————-

"134-Sound transmitting equipments               At the point of
including telephones, loudspeakers,              first sale in the
dictaphones, gramaphone and similar              State by a dealer           12%
apparatus for recording and reproduc-            who is liable to
ing sound and spare parts and acce-              tax u/s 5.
ssories thereof including gramaphone,
spare parts, accessories and components
and parts thereof.

55- Electronic systems, instruments,
apparatus and appliances other than                     .do.                 8%
those specified elsewhere in this
Schedule and spare parts and acce-
ssories thereof."

————————————————————————————-

While Government Pleader referred to the dictionary meaning and

Encyclopaedia meaning of “loud speaker” which takes in every loud

speaker including those attached to car stereos, counsel for the

respondent has relied on Entry 55 itself. After hearing both sides and

S.T.Rev. 175/2008 3

on going through the above Entries, we are of the view that the

Tribunal’s order in favour of the respondent is sustainable because car

stereos are admittedly electronic goods covered by Entry 55 and

speakers are nothing but accessories which are separately covered by

the very same entry i.e. Entry 55. The contention of the Government

Pleader is that items which are covered by other specific entries in the

Schedule are excluded from Entry 55. In other words, according to

him, electronic items like television separately covered by other entries

are not covered by Entry 55. We notice that Entry 55 does not specify

any item and it covers a category of goods. The position is same so far

as Entry 134 is also concerned. Television being a specific item

separately covered by an entry is assessable under such Entry, no

matter it would have otherwise fallen under the general category of

“electronic items” under Entry 55. The position is same even for toys,

whether electronic or not, which being separately covered by an Entry,

is assessable under such Entry. However, in this case the department

concedes the position that car stereo is an electronic item assessable

under Entry 55. So much so, the speakers suitable for attachment to car

S.T.Rev. 175/2008 4

stereos will also be assessable under Entry 55, if those constitute

“accessories” to it. Nobody can have a dispute that speakers attached

to stereos are not accessories to it because without the speaker, stereo

cannot be put to use at all. So much so, loud speakers which do not

form accessory to any electronic item, only are covered by Entry 134

and loud speakers constituting accessory of electronic goods like

stereo, car stereos, and radios are covered by Entry 55. Consequently

we dismiss the revision case upholding the order of the Tribunal.

C.N.RAMACHANDRAN NAIR
Judge

K.SURENDRA MOHAN
Judge

pms