DIVYA AUTOMOBILES LTD Vs. STATE OF KERALA

JUDGEMENT

(1.) THE matter arises under the Kerala General Sales Tax Act (for short "the Act" ). THE assessee is the revision petitioner. THE assessment year is 1992-93. THE petitioner was a dealer in automobiles and light commercial vehicles, etc. THE assessing authority while completing the assessment for the year 1992-93 treated the sales effected by the petitioner as per Invoice Nos. 513, 517 and 518 as sales of chassis of motor vehicles only and levied tax at five per cent as per S. R. O. No. 369 of 1992. According to the petitioner the commodity covered by the aforesaid three invoices was light commercial vehicles taxable at four per cent only under the notification mentioned above. In appeal by the petitioner the first appellate authority accepted the contention of the petitioner and allowed the appeal. However, in appeal by the State before the Sales Tax Appellate Tribunal, Additional Bench, Ernakulam, the order of the first appellate authority was set aside and the order of the assessing authority was restored. Hence this revision.

(2.) LEARNED counsel appearing for the petitioner submitted that the items sold by the petitioner as per Invoice Nos. 513, 517 and 518 (annexures D, E and F respectively) were motor vehicle engine and chassis. The general description of the goods is as follows : " Eicher Mitsubishi Canter Model FE 444 with 92. 5 HP direct injection 4 stroke engine along with 6 Nos. 7. 50 x 16 x 12pr nylon tyres and tubes, one spare wheel with tyre and tube, tools and spares in the following configuration x 3760 mm Cowl & Chassis Crystal White Engine No. 120715556 Chassis No. 4ff20723111. " The counsel submits that what is sold is not chassis alone but chassis and engine with cabin which cannot be characterised as chassis only. The counsel submits that what was sold is nothing but motor vehicle. The counsel also took us to entry 86 of the First Schedule to the Act as it stood at the relevant time and also the relevant items in Notification SRO No. 369 of 1992 and submitted that the items covered by the three bills are liable to be assessed as light commercial vehicle under item 17 of Notification SRO No. 369 of 1992.

(3.) THE facts are not in dispute. What the assessee had sold is chassis with engine. So the only question for consideration is as to whether chassis with engine can be treated as chassis falling under item 5 or a light commercial vehicle falling under item 17 of the Second Schedule to the notification. In order to decide this issue, it is necessary to refer to entry 86 of the First Schedule to the Act as it stood during the assessment year and the relevant entries in the Notification S. R. O. No. 369 of 1992. Entry 86 of the First Schedule as it stood at the relevant time reads as follows : " 86. Motor vehicles, chassis of motor vehicles, motor cycles, motor cycle combinations, motor scooter, mopeds, motorettes, three wheelers, motor vessels, motor engines, trailers, motor bodies built on chassis of motor vehicles, bodies built on motor vessels or engines and spare parts and accessories thereof. " THE rate of tax on the sale of all or any of these items is 15 per cent as per the entry. By S. R. O. No. 369 of 1992 the State Government in public interest made a reduction in the rate of tax payable under the Act on the sale of goods mentioned in column (2) of the Second Schedule to the rate mentioned against each of the items in column (3) thereof. Item Nos. 5, 6, 17 and 18 of the Second Schedule with Scheduled rate and the reduced rates are as follows : ---------------------------------------------------------------- Sl. Description of good Reduced rate of tax No. From To ---------------------------------------------------------------- (1) (2) (3) ---------------------------------------------------------------- 5. Chassis of motor vehicles other 15% 5% than trucks and buses 6. Chassis of trucks and buses 15% 4% 17. Motor vehicles of the category of 15% 4% light commercial vehicles other than motor car, motor taxi cabs, three wheelers, jeeps, truckers and all other petrol driven vehicles. 18. Motor cars, motor taxi cabs, three 15% 5% wheelers, jeeps, truckers and all other petrol driven vehicles.---------------------------------------------------------------- Under entry No. 86 of the First Schedule motor vehicles, chassis of motor vehicles, motor engines, motor bodies built on chassis of motor vehicles, spare parts and accessories thereof for which the rate of tax is fixed at 15 per cent. Under Notification S. R. O. No. 369 of 1992 item No. 5 deals with chassis of motor vehicles other than trucks and buses for which the reduced rate of tax is five per cent. Under item No. 6 for chassis of trucks and buses the reduced rate of tax is four per cent. Under item No. 17 motor vehicles of the category of light commercial vehicles other than motor car, motor taxi cabs, three wheelers, jeeps, truckers and all other petrol driven vehicles the reduced rate of tax is four per cent. THE petitioner claims that items sold by it come under the category of light commercial vehicles whereas according to the department it will fall under item No, 5, viz. , chassis of motor vehicles other than trucks and buses.