Commissioner of Commercial Tax vs S/S R.S. Glass Industries

Ashwani Kumar Mishra, J.—Heard learned Standing Counsel for the State and Sri Krishna Agarwal, learned counsel for the respondent.

The first appellate authority as well as the tribunal have relied upon the provisions of Section 4 (3A) of the U.P. Tax on Entry of Goods into Local Areas Act, 2007, to hold that once the gas has been brought within the local limits of Agra by the Gas Authority of India Ltd., and entry tax has been paid, any subsequent transfer thereof to the dealer would not entail any further liability of tax. A finding has been returned that Gas Authority of India Ltd., in respect of gas in question has already paid entry tax, and therefore, no further tax is payable at the hands of assessee.

This revision has been filed by the revenue contending that the assessee in his statement of account has clearly specified the turnover of purchase of gas as amounting to Rs.1,25,96,605/-, and therefore, the entry tax is payable upon such amount, and since a lesser amount has actually been paid by Gas Authority of India Ltd., therefore, the remaining amount quantified at Rs.2,55,228/- is liable to be paid as entry tax.

The premise on which this revision has been filed clearly overlooks the provision contained under sub-section (3A) of Section 4 of the Act. The turnover of purchase by the assessee is not the relevant factor to determine liability of tax, inasmuch as the effect thereof would be to virtually nullify the provision contained under sub-section (3A). The object of sub-section (3A) of Section 4 is to eliminate any liability of tax upon a subsequent dealer, if it is established that at the time when the good has been brought into a local area, tax payable has actually been deposited. In view of the finding that the Gas Authority of India Ltd. has already paid entry tax for the gas in question, the subsequent transfer thereof to the assessee would not enable the State to demand entry tax. The first appellate authority as well as the tribunal have correctly interpreted the provision of Section 4 (3A) of the Act, and the question of law formulated is answered accordingly.

The revision is, accordingly, consigned to records.