ENERCON (INDIA) LTD. Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) The Appellant herein, by way of present appeal, questions the validity and legality of the judgment and order dated 18.08.2004 passed by the High Court of Karnataka, at Bangalore, in Sales Tax Revision Petition No. 72 of 2002 which was filed by the Appellant herein. The said Revision Petition has been dismissed by the High Court thereby affirming the orders of the authorities below. The facts in brief, which need to be noted for the disposal of the instant appeal, are that the Appellant is engaged, inter alia, in the manufacture, sale, installing and commissioning of Wind Mill (Wind Energy Converter). It is a registered dealer under the Karnataka Sales Tax Act (hereinafter referred to as 'the Act'). The Appellant had entered into the contracts dated 12th June, 1997 and 11th July, 1997 with M/s. Jindal Aluminium Ltd., Bangalore. These contracts were for installation, erection and commissioning of "'Wind Energy Converter" for 16 Nos. Enercon make E -30 rated at 230 KW Wind Energy Converters. These were to be commissioned at Medakaripuram, Chitradurga Taluk, Karnataka State. The total value of the contracts was Rs. 19,67,50,000/ -. In the sales tax return filed by the Appellant, it sought exemption from payment of sales tax on the ground that as per the provisions contained in Entry 57 of Fifth Schedule to the Act, Wind Mills were exempted from payment of sales tax. The provision for exemption is contained in Sec. 8 of the Act which reads as under:

(2.) Fifth Schedule to the Act gives list of various kinds of goods which are entitled to exemption. As mentioned above, insofar as Wind Mills are concerned, relevant Entry is at Serial No. 57 which is as follows:

(3.) The Assessing Officer after getting details of the aforesaid turnover of Rs. 19,67,50,000/ - from the Appellant/Assessee found that apart from various parts of Wind Mills which were supplied to the customers, expenditure was also incurred towards commissioning of the said Wind Mills at the site which had to be excluded. The exercise done by the Assessing Officer in this respect can be seen from the assessment order passed by the Assessing Officer. The relevant portion whereof giving such details, is as follows: