GSTR No. 111 of 1993 1
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH.
G.S.T.R.No. 111 of 1993
Date of decision 8.1.2009
M/s Jiwan Coach Builders ...Petitioner
Versus
State of Punjab ... Respondents
CORAM: HON'BLE MR. JUSTICE M.M. KUMAR
HON'BLE MR. JUSTICE H.S. BHALLA
Present: Mr.Ramesh Kumar ,Advocate for the petitioner.
1. Whether Reporters of local papers may be allowed to see the judgement ?
2. To be referred to the Reporter or not ?
3. Whether the judgement should be reported in the Digest ?
M.M.KUMAR, J.
This Court has issued directions on 25.11.1992 under Section
22(2)(b) of the Punjab General Sales Tax Act,1948 (for brevity ‘the Act’)
directing the Sales Tax Tribunal, Punjab to refer the following question of
law arising from STC case No. 59 of 1992:
” Whether the instructions issued by the Excise and Taxation
Commissioner, Patiala, vide communication dated January 8,
1974, to all the Assessing Authorities (Excise and Taxation
Officer) in the State of Punjab for charging tax at the rate of 6
percent sales tax on the bus bodies instead of 10 percent were
not binding on the Sales Tax authorities ?.”
The facts as have been revealed in the reference order are that the
dealer is engaged in the manufacture of bus bodies and sale thereof. The
assessment for the year 1972-73 was framed by the Assessing Authority,
Jalandhar on 9.11.1976 and additional demand of Rs. 67,087.19 P. was
GSTR No. 111 of 1993 2
raised. The dealer preferred an appeal before the Deputy Excise and
Taxation Commissioner (A),Jalandhar who had vide order dated 9.9.1977
accepted the plea of the dealer that rate of tax on the bus bodies should be 6
percent instead of 10 percent in accordance with the instructions issued by
the Excise and Taxation commissioner, Patiala on 8.1.1974. On a suo motu
proceedings initiated under Section 21(1) of the Act, the Excise and
Taxation Commissioner, Punjab examined the legality and propriety of the
order dated 9.9.1977 passed by the Deputy Excise and Taxation
Commissioner (A) and the same was set aside. The Commissioner also
remanded the matter to the Assessing authority for de-novo assessment vide
order dated 9.7.1981. Therefore, the assessment proceedings were initiated
again. The Assessing Authority vide order dated 23.2.1982 again levied tax
@ 10 percent on taxable turnover of Rs. 14,19,334/- on the sale of bus
bodies to the public. On appeal, the Deputy Excise and Taxation
Commissioner (A) upheld the order of the Assessing Authority vide his
order dated 8.10.1984 by observing that the Assessing authority had rightly
framed the assessment in accordance with the directions issued by the
Commissioner and has charged tax @ 10 percent on the sale of bus bodies
to public instead of 6 percent. The dealer approached the Sales Tax Tribunal
which has upheld the levy of tax @ 10 percent on bus bodies in stead of 6
percent vide its order dated 29.9.1990. It was thereafter that the dealer filed
reference application before the Tribunal under Section 22(1) of the Act
which was declined by the Tribunal vide its order dated 31.7.1991 by
observing that the question of law referred for adjudication of this Court
would not arise out of the order of the Tribunal. The declining of reference
was challenged by the dealer before this Court under Section 22(2)(b) of the
GSTR No. 111 of 1993 3
Act and accordingly vide order dated 25.11.1992 passed in Sales Tax Case
No.59 of 1992 directions were issued to the Tribunal for preparing the
statement of case and refer the afore-mentioned question to this Court for
adjudication.
Having heard learned counsel for the parties and perusing the
record we are of the view that the reference deserved to be answered in
favour of the dealer. The matter is not res-integra. In the case of Ambala
Coach Builders v. State of Haryana 1977(39) STC 44 a fundamental issue
was raised namely whether the expression “motor vehicle” included
component parts thereof as per the expression used in Entry No.1 of
Schedule A of the Haryana General Sales Tax Act, 1973. This Court placed
reliance on the judgements of Hon’ble the Supreme Court rendered in the
cases of Annapurna Carbon Industries Co. v. State of Andhra Pradesh
(1976) 37 STC 378; Commissioner of Sales Tax, Uttar Pradesh , Lucknow
v. Pritam Singh (1968) 22 STC 414 and Bajoria Halwasiya Service Station
v. State of Uttar Pradesh (1970) 26 STC 108 and came to the conclusion
that bus bodies mounted on motor chassis cannot be regarded as assessories
or spare parts but are necessarily to be regarded as component parts of
motor vehicle. The Bench went on to observe as under:
“…. It is seen that wherever the legislature wanted component
parts to be taxed in the same manner as the principal machine
or equipment of which they were parts, it had expressly said so.
I am, therefore, unable to say that the expression ‘motor
vehicles’ includes its component parts such as bus bodies. In
fact this had been the view of the department itself until very
recently as may be seen from the instructions issued by the
Government on 9th September, 1974, according to which, sales
GSTR No. 111 of 1993 4tax had to be charged at the general rate of 6 percent and not at
the special rate of 10 percent. It is only recently that these
instructions have been modified and fresh instructions issued
on 8th January, 1974. Bus bodies have now been instructed to
be taxed at the rate of 10 percent. Even this was done because
of an objection raised by the audit party of the office of
Accountant General, Haryana. I, therefore, hold that the bus
bodies on motor chassis are not liable to be taxed as if they fall
within entry 1 of Schedule A. The writ petition is, therefore,
allowed and the order dated 4th May, 1976 of the Excise and
Taxation Officer is quashed.”
Accordingly in accordance with the afore-mentioned observations,
the bus bodies have to be regarded as component parts of the motor vehicle.
Once the aforesaid factual position is clear then it follows that it has to be
assessed @ 6 percent as per entry 9 of Schedule A of the Act.
In view of the above, the question is answered in favour of the
dealer and against the Revenue.
(M.M.Kumar)
Judge
(H.S. Bhalla )
8.1.2009 Judge
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