BATES INDIA PVT. LTD., FORMERLY KNOWN AS CLARION ADVERTISING SERVICES LTD. REPTD. BY ITS AUTHORISED SIGNATORY, SRI K.S. LAKSHMANAN S/O SRI K.R. SHIVARMA KRISHNA IYER Vs. THE STATE OF KARNATAKA THROUGH THE COMMISSIONER OF COMMERCIAL TAXES@RESPOND

JUDGEMENT

(1.) WE have reheard Mr. G. Sarangan, learned Senior Counsel today in this Sales Tax Revision Petition.

(2.) THE correctness of the order dated 21st November 2006 passed by the Karnataka Appellate Tribunal, Bangalore, in STA Nos. 691 to 711 of 2002, affirming the order of the Assessing Authority by dismissing 21 appeals filed by the petitioner herein by holding that the petitioner is carrying on business in advertising and Publicity, supply of printed materials like booklets, calendars, diaries, visiting cards etc., in the course of business and liable for levying Turnover Tax under Section 6 -B of the Karnataka Sales Tax Act, 1957 (an 'Act' for short), is questioned in this writ petition.

(3.) THE learned Senior Counsel appearing on behalf of the petitioner herein questioned the correctness of the finding recorded by the Karnataka Appellate Tribunal, concurred by the first Appellate Authority and aggrieved with the same by the Second Appellate Tribunal in the impugned order held that the business carried on by the petitioner relates to the supply of the printed materials in respect of the calendars, diaries etc., Therefore, the petitioner is a dealer liable for tax on total turnover under Section 6 -B of the Act is questioned, placing strong reliance on the judgment of the Supreme Court in the case of Imagic Creative Pvt. Ltd. v. The Commissioner of Commercial Taxes and Ors. in which, he has taken us to the relevant paragraphs of the Supreme Court decision which has considered the provisions of the Service Tax Act and Sales Tax Act. The learned Counsel substantiated the contention that the petitioner is rendering service and not carrying on business to come within the definition of dealer as defined under Section 2(K) which defines to attract levy of tax under Section 6 -B of the Act. It is further contended that Service Tax has already been paid to the Central Government. Therefore, the finding recorded by the first Appellate Authority and the Tribunal are not only erroneous in law but also suffers in law and further submits that the finding recorded on the contentious points by the ICAT is vitiated both on facts and materials produced before the Appellate Authority and the provisions of the KST Act namely the Dealer as defined under Section 2(k) of the Act. Petitioner is neither doing business nor dealing, selling, supplying or distributing goods directly or otherwise or for commission, remuneration or for other valuable consideration and also for want of sub -clauses incorporated therein, as the petitioner is a service oriented advertising agency and the same is being carried on to its customers. Therefore, its activities do not fall within the definition of the dealer. As only service is being rendered to its customers. Therefore, it is contended that the petitioner has not registered as a dealer under the provisions of KST Act. The Appellate Authority was not right in issuing proposition notice and passing the assessment order holding that it is doing business, supplying all the materials like booklets, calendars, diaries etc., to its customers and therefore, it is liable to pay turn over Tax to the Department.