Tablets (India) Limited vs State of Andhra Pradesh

Syed Shah Mohammed Quadri, J.—This revision, u/s 22(1) of the Andhra Pradesh General Sales Tax Act, 1957 (for short, "the Act"), is by the dealer registered under the said Act.

The short question that arises for consideration is how should the rate of additional tax be applied for assessment of the turnover of the petitioner u/s 5-A of the Act ?

The turnover of the petitioner for the said assessment year was determined at Rs. 1,18,32,990 by the assessing authority by its order dated September 13, 1991. The petitioner preferred appeal before the Appellate Deputy Commissioner, Guntur but was unsuccessful in obtaining the relief from the appellate authority. The appeal was dismissed on November 16, 1991. The petitioner then carried the matter in appeal before the Sales Tax Appellate Tribunal, Hyderabad. By its order dated November 25, 1994, the Tribunal confirmed the order of the first appellate authority. The petitioner is, therefore, before us challenging the validity of the said order of the Sales Tax Appellate Tribunal.

Having regard to the question raised in this revision, it would be appropriate to extract the provisions of section 5-A of the Act.

"5-A. Levy of additional tax on turnover. - Every dealer who is liable to pay tax under sections 5, 5-C, 5-E, 6, 6-A and 6-C shall, in addition to the tax payable under those sections pay for each year a tax on his turnover liable to tax at the rate of -

(a) one-half paise on every rupee where the total turnover for the year is three lakh rupees or more but less than fifty lakh rupees;

(b) one paisa on every rupee where the total turnover for the year is fifty lakh rupees or more but less than one crore rupees; and

(c) one and a half paise on every rupee where the total turnover for the year is one crore rupees or more.

Provided that in respect of declared goods the total rate of tax together with the rate of additional tax specified in this section shall not exceed four per cent."

The contentions of Sri P. Srinivasa Reddy, the learned counsel for the petitioner, are that out of the total turnover of the petitioner, the turnover between Rs. 3 lakhs and Rs. 50 lakhs ought to have been subjected to tax at the rate of one-half paise on every rupee, the turnover between Rs. 50 lakhs and one crore ought to have been taxed at the rate of one paisa on every rupee and then only the balance of the turnover should have been taxed at the rate of one and a half paise on every rupee. We are afraid, we cannot accede to the contention of the learned counsel for the petitioner.

A plain reading of section 5-A of the Act, extracted above, makes it clear that the said section classifies the dealers in three categories. The dealers having net turnover between Rs. 3 lakhs and Rs. 50 lakhs fall in the first category. The dealers having turnover of more than Rs. 50 lakhs but less than one crore fall in the second category and dealers having turnover of one crore or more fall in the third category. The obvious intention of the Legislature is to grant the relief by providing lesser rate of additional tax on the turnover in case of small dealers whose turnover is less. Once the turnover of a dealer exceeds Rs. 1 crore, he falls under the third category and for the purposes of levying additional tax, his turnover cannot be divided in three categories for granting benefit of lesser rate of tax. In this view of the matter, we do not find any illegality in the order of the Tribunal warranting our interference in the revision.

The tax revision case fails and we dismiss the same. No order as to costs.

Petition dismissed.