GUNNEBO INDIA LTD Vs. COMMISSIONER

JUDGEMENT

(1.) THIS is an appeal under Section 81 of the Delhi Value Added Tax Act, 2004 wherein the appellant challenges the order dated 23.03.2012 passed by the Appellate Tribunal, Value Added Tax, Delhi (Tribunal).

(2.) THE facts necessary for the disposal of this appeal are that the appellant herein was functioning during the relevant Assessment Year (1996-97) as reseller of safes/lockers and other related equipment. The appellant was originally assessed under the Delhi Sale Tax Act, 1975 whereby it deposited tax @ 7%. The Sales Tax Officer (STO) by order dated 28.12.1999 finalized the assessment, taxing sale of safety doors/air ventilators/lockers etc @ 12% by holding that they were covered by Entry 22 of Schedule 1 to the Delhi Sales Tax Act, 1975 instead of 7% as claimed by the appellant. This view was upheld by all authorities in appeal, including the Tribunal . The following question arises for this court's consideration:

(3.) DURING the hearing of this appeal, learned counsel for the appellant firstly pointed out that the commodity in question consists of multiple boxes hinged together that are individually secured, and are used in strong rooms of banks; that they are also called vaults. He assailed the impugned judgment reasoning that Entry 22 is specifically limited to safes and almirah, and cannot be extended to include within its ambit products not mentioned in the entry merely because their function is similar; moreover, that the said entry was not an "umbrella entry" so as to cover all types of storage goods. Counsel further urged that it is a matter of common experience that the identity of an article is associated with its primary function; when a consumer buys an article, he buys it because it performs a specific function for him; that in case of safe and almirahs, the consumer, while buying them, keeps in mind not only the aspect that they are for storing purposes, but also the fact that he would have a direct control over the product, as the same would be in his custody; but lockers, on the other hand, are bought primarily for commercial exploitation by institutions like banks which give them on hire to their customers. This distinguishing factor, it was argued, necessitates that lockers not be read as being covered under Entry 22.