P O ABRAHAM ASSOCIATES Vs. COMMISSIONER COMMERCIAL TAXES

JUDGEMENT

(1.) The petitioner is a contractor-cum-supplier among other persons to Cochin Shipyard Ltd. The petitioner obtained a purchase order from the Cochin Shipyard Ltd. for purchase of various electronic components for use in their manufacture, or repair of ships. The petitioner claims the benefit of notification, SRO 1091/99, which under Clause 3 of its Schedule III provides for reduction of rate of tax in respect of supply of goods at the rate of 5 percent. The benefit under the notification is for the Industrial units including public sector undertakings for use in the manufacture of processing of goods by them or on job work basis within the State. The reduction in rate of tax is 5%. There is no dispute with regards to rate of tax applicable on the sales which are certified by the purchasers in terms of Annexure I to the notification.

(2.) The grievance of the petition is that though the petitioner is not liable to pay additional Sales tax under section 5D of the KGST Act, the petitioner will be called upon to pay the same in view of the clarification Ext. P2 and therefore the petitioner has challenged the said clarification issued by the Commissioner of Commercial Taxes under Section 59A of the KGST Act in this Original Petition. According to the said clarification, the reduced rate under the above said notification does not apply to addl. Sales tax which is a special levy. The petitioner has pointed out that another party has challenged the very same clarification and this Court remanded the matter for reconsideration by the Commissioner of Commercial Taxes. However, no order are seen issued. In the circumstances, the petitioner is challenging the validity of the clarification . The petitioner has further submitted that the judgment based on which this court has remanded the other case to the Commissioner of Commercial Taxes does not apply to the facts of the petitioner's case and the petitioner does not want a remand in the matter. In the circumstances, I proceed to decide the issue on merits.

(3.) For the sake of clarity and completeness the relevant section 5D is extracted below, which is only for 2001-02 : 5D. Levy of Additional Sales Tax :- The tax payable under Section 5 and Section 5A shall be increased by an additional Sales tax at the rate of fifteen per cent of the tax payable under the said Sections : Provided that no additional sales tax under this section shall be levied, -