LexCOMMISSIONER OF COMMERCIAL TAXES & ORS. versus M/S BAJAJ AUTO LTD. & ANR.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
[2016] 7 S.C.R. 1008
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COMMISSIONER OF COMMERCIAL TAXES & ORS.
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MIS BAJAJ AUTO LTD. & ANR.
(Civil Appeal Nos. 5913-5920 of2008)
OCTOBER 28, 2016
[SHIVA KIRTI SINGH AND R.K. AGRAWAL, JJ.]
Orissa Sales Tax Act, 1947 - s.5A - Levy of surcharge
under - Co111putatio11 of - Whether surcharge u/s. 5A is to be
computed on the gross amount of sales tax or on the net amount of
sales tax after setting off or deducting the amount of entry tax -
Held: On a conjoint reading of s.5 of the Act, s.4 of Entry Tax Act
and r.18 of Entry Tax Rules, surcharge uls. 5A is to be levied before
deducting the entry tax - Orissa Enfly Tax Act, 1999 - s.4 - Odisha
Entry Tax Rules, 1999 - r.18.
Interpretation of Statutes - interpretation of Rules made under
statutes - Held: The Rules are to be construed to have been made
for further once of the cause for which the statute is enacted and
not for the purpose of bringing inconsistencies - The illustration
given under the Rules can neither curtail nor expand the ambit of
the statute it illustrates.
Tax/Taxation - Surcharge - Is an additional tax - Is payable
in the manner laid down for levy of surcharge.
Allowing the appeals, the Court
HELD: 1. On a plain reading of the provisions of the Orissa
Sales Tax Act, 1947 (OSTACT) as well as the Orissa Entry Tax
Act, 1999 (OETACT) and the Orissa Entry Tax Rules 1999, it
can be. seen that Section SA of the OST Act creates a charge and
imposes liability on every dealer under the OST Act to pay
surcharge @ 10% on the amount of tax payable by him under the
OST Act. Section 4(1) of the OET Act, in the same way, prescribes
for reduction of the tax amount payable by the dealer to the extent
of entry tax already paid for the same article for which sales tax is
payable. The Section, does not specifically contemplate anything,
which would indicate that the provisions of the OET Act or the
Rules have to be taken into consideration while assessing the
sales tax or surcharge. [Para 19) (1019-D-E]
1008
COMMISSIONER OF COMMERCIAL TAXES & ORS. v. M/S
BAJAJ AUTO LTD. & ANR.
2. The objective of framing rules is to fill up the gaps in a
statutory enactment so as to make the statutory provisions
operative. Rules also clarify the provisions of an Act under which
the same are framed. An illustration given under the Rules does
not exhaust the full content of the section which it illustrates but
equally it can neither curtail nor expand its ambit. [Paras 18 and
20] [1019-B; G-H]
Shambhu Nath Mehra v. The State of Ajmer AIR 1956
SC 404: 1956 SCR 199; La/it Mohan Pandey v.
Pooran Sinf{h and Others (2004) 6 SCC 626: 2004
(1) Sup1JI. SCR 737 - relied on.
3. In essence, the provisions made in the Rules, lay down
the modality of 'set off'. OST Act was enacted in the year 1947
whereas OET Act was enacted in 1999. The provision of 'set off'
has been made in the OET Act and the Rules framed thereunder
and not in the OST Act. The heading of Section 4 of the OET Act
gives a broad idea regarding the provision of 'set off' by way of
"reduction in tax liability". [Para 19] (1019-F]
4. Surcharge is nothing but an additional tax and is payable
on the sale of goods in the manner laid down for levy of surcharge.
Section SA of the OST Act is a self-contained provision and the
surcharge is leviable at the specified per centum of tax payable
under the OST Act. Tax payable under the OST Act is independent
of the provisions of OET Act. The assessment or quantification
or computation of surcharge shall have to be made in accordance
with the provisions of the OST Act. [Paras 18 and 21] [1019-C;
1020-C-D]
The Commissioner of Income Tax, Kera/a v.
K.
Srinivasan (1972) 4 SCC 526: 1972 (2) SCR 309;
The Madurai District Central Co-operative Bank Ltd.
v. The Third Income Tax Officer, Madurai (1975) SCC
454: 1976 (1) SCR 136; Mis Hoechst Pharmaceuticals
Ltd. and Others v. SIL/le of Bihar and Others (1983) 4
SCC 45: 1983 (3) SCR 130; Mis Ashok Service Centre
and Others v. State of Orissa (1983) 2 SCC 82: 1983
(2) SCR 363; Sarojini Tea Co. (P) Ltd. v. Collector of
Dibrugarh, Assam and Another (1992) 2 SCC 156:
1992 (1) SCR 371- relied on.
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SUPREME COURT REPORTS
[2016] 7 S.C.R.
S. On a plain reading of the provisions under the OST Act
as well as under the OET Act, a dealer is not entitled for reduction
of the amount of entry tax from the amount of tax payExcerpt shown. Read the full judgment & AI analysis in Lexace.