SRINIVASA RICE MILL Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) THESE appeals are filed against the orders of the Dy. Commissioner (CT), Eluru. Following are the facts leading to the filing of these appeals by various appellants/dealers.

(2.) THE appellants are all registered dealers and are being assessed by their respective Commercial Tax Officers, The appellants are carrying on business in Paddy & Rice. They were finally assessed for the assessment year 1997 -98 under APGST Act. On a perusal of those assessment orders by the Dy. Commissioner(CT), Eluru noticed that the assessing authorities exempted the turnover representing collections of Rural Development Cess by the dealer from the F.C.I. The Dy. Commissioner(CT), revisional authority was of the opinion that exemption of said disputed turnover is incorrect and caused prejudice to the interests of the revenue. Therefore, he took up revision of all the assessment orders and issued pre -revisional notices to all the assessees and after considering their objections has finally with -drawn the exemption and imposed tax at 4% on the disputed turnovers.

(3.) THE State Representative opposed the claim of the appellants and has also filed written arguments mainly contending that the mere payment of R.D.C. by the appellants to various dealers does not amount to that they have a statutory obligation to pay under R.D. Act. It is a settled law that where the Collector of the tax collects the said tax, in view of the statutory law authority, as an agent of the State, such component of the tax will not fall under the expression of the turnover in the hands of said collecting agent. But, however, if the said collector, collecting the said sum which is equivalent to the tax and passed on the same to his purchasers, the said component of tax will form part of the sale price. In all these cases on hand the dealer has not been collecting the R.D.C. as an agent of the State Government, but he is collecting the same as tax from the F.C.I., passing on their burden, to the F.C.I. as the appellant is liable to pay R.D.C. under the R.D. Act. The Rural Development Act and Rules, did not that all contemplate the statutory obligation on the part of the purchasers to collect from the miller/dealers to pay tax, in order to say, that these appellants are collecting the tax, as an agent of the State Government. Therefore, he contended that the revisional authority has rightly imposed tax on the turnover representing the RDC, collected by these appellants, from the FCI. as it form part of the sale price. He further stated that the appellants contention that the FCI has agreed to pay RDC only on the intervention of the Government of Andhra Pradesh, and that then only, the appellants agreed to pay the RDC to the State Government, is not a criteria to hold that the FCI has got a statutory obligation to pay the RDC.