M/S. Super Packaging Industries vs The Sales Tax Officer on 21 November, 2008

       

  

  

 
 
  IN THE HIGH COURT OF KERALA AT ERNAKULAM

WP(C).No. 25623 of 2005(A)


1. M/S. SUPER PACKAGING INDUSTRIES,
                      ...  Petitioner

                        Vs



1. THE SALES TAX OFFICER,
                       ...       Respondent

2. THE STATE OF KERALA,

                For Petitioner  :SRI.V.P.SUKUMAR

                For Respondent  : No Appearance

The Hon'ble MR. Justice C.N.RAMACHANDRAN NAIR

 Dated :21/11/2008

 O R D E R
                       C.N.RAMACHANDRAN NAIR, J.
                  ....................................................................
                            W.P.(C) No.25623 of 2005
                  ....................................................................
                 Dated this the 21st day of November, 2008.

                                         JUDGMENT

The W.P. is filed challenging the demand of tax at the rate of 1% on

sales turnover of packing material sold by the petitioner to exporters

covered by valid Forms. The petitioner’s case is that petitioner produced

Form H obtained from exporters and based on the same petitioner is entitled

to full exemption on sales turnover of packing materials. However,

Government Pleader submitted that Form H covers only goods covered by

export orders and not packing materials purchased by the exporter for

packing of goods for export. He also brought to the notice of this court that

concessional rate is granted for sale of packing materials to exporters under

Notification No.958/2002 under which eligible benefit is granted to the

petitioner for the turnover covered by such Forms.

2. The petitioner’s claim for exemption based on Form H produced

from exporters was rightly rejected because Section 5(3) provides for

exemption of sale to exporters only for the purchase made by the exporter

against advance exports orders for export of goods. The petitioner has no

case that the goods purchased by the exporter from the petitioner were

2

goods which are exported as such. In other words, export orders produced

by the petitioner from the buyers were for export of other goods by the

exporter and the items sold by the petitioner was used for packing of such

goods. Section 5(3) provides for exemption only on sale to exporter of

goods which are exported by the exporter against prior orders for export. In

other words, raw materials, packing materials etc. purchased by the exporter

are not separately covered by Section 5(3) of the Act which provides for

exemption only for the goods exported. In fact, it is only because of the

non-availability of exemption for sale of packing material to exporters

under Section 5(3) of the Act, the Government granted an incentive by way

of reduction in rate of tax to suppliers of packing materials to exporters for

packing goods for export. Since the Notification requires production of

prescribed Forms for availing concessional rate, petitioner was rightly

declined exemption of turnover not covered by such forms. The W.P. is

therefore devoid of any merit and is dismissed.

C.N.RAMACHANDRAN NAIR
Judge
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