C.T.O. Vs. D.N. STEELS

JUDGEMENT

(1.) The Jodhpur Vidhyut Vitran Nigam Limited (for JVVNL) put up on auction its 3 x 3 MW power plant, by auction notice somewhere in the year 2001 and the respondent - assessee being highest bidder purchased the said old unserviceable power plant which had been closed by the JVVNL (erstwhile RSEB) about 13 years back in the said auction and the controversy which is in hand in the present revision petition filed by the Revenue is that what is the rate of sales tax application to such auction price received by the JVVNL on the sale of said unserviceable power plant. The case of Revenue is that the said commodity, namely, the power plant was sold on "as is where is basis" and therefore, it was a sale of "plant and machinery" attracting 12% rate of tax and 15% surcharge thereon, whereas the case of the respondent-assessee is that it was taxable as "iron and steel scrap" attracting only 4% rate of tax.

(2.) The respondent-assessee appears to have approached the Commissioner, Commercial Taxes in this regard by way of an application under Section 40 of the RST Act, 1994 dtd. 19.10.001, which empowers the learned Commissioner to decide the disputed questions about the rate of tax applicable on a particular commodity, who vide his order dtd. 22.1.2002 decided the question against the respondent-assessee and held that the commodity sold in auction by JVVNL was plant and machinery like steam turbine, alternator, boiler, chimney, hoppers and crane etc. Which on taken together was power plant and attracted rate of tax @ 12% and 15% surcharge therein.

(3.) The respondent-assessee being aggrieved by the said order of the learned Commissioner approached the Rajasthan Tax Board, Ajmer who vide its impugned order dtd. 23.1.2003 held in favour of the assessee that the sale in question was that of "iron and steel scrap" as power plant in question was old and unserviceable and the respondent-assessee had to dismantle the same and take it away as iron and steel scrap only. The learned Tax Board also noticed that the respondent-assessee was a registered dealer of iron and steel scrap only and was not a dealer of plant and machinery including power plant. Relying on certain decision of the Hon'ble Supreme Court and other High Courts, the Tax Board held that such auction attracted rate of tax at 4% only and not 12% as contended by the Reenue. In respect of certain items like 20 MT Crane, 11 KV OCB and 300 MT Coal, the Tax Board however, held that since the JVVNL had not issued any certificate, the same would be taxable @ 12% only. However, there is no further challenge in respect of these items from the side of the respondent-assessee and therefore, it is not the question involved in the present revision petition filed by the Revenue.