LexPEPSICO INDIA HOLDINGS LTD. versus COMMISSIONER OF TRADE TAX, LUCKNOW, U.P.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
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[2011] 4 S.C.R. 723
PEPSICO INDIA HOLDINGS LTD.
V.
'
COMMISSIONER OF TRADE TAX, LUCKNOW, U.P.
(Civil Appeal No. 2926 of 2011)
APRIL 5, 2011
[DR. MUKUNDAKAM SHARMA AND
ANIL R. DAVE, JJ.]
UP. Trade Tax Act, 1948:
s.8(1) and its Explanation, s.8(18) - Interest on delayed
payment of tax - Whether payable as per s.8(1) or as per
s.8(18) - Held: If tax is admittedly payable and is not paid,
the same becomes payable along with interest as mentioned
A
B
c
in s.8(1) - Once it is. confirmed by the Court that the tax is
0
payable under the Act, it would be covered within the definition
of the term "the tax admittedly payable" as defined in the
explanation to s.8(1) and, in case, the tax had not been paid
then the same becomes payable along with interest as
mentioned in s.8(1) - Provisions of sub-section (18) of s.8
E
would come into operation only if the ·case is not covered
·under sub-section (1) of s.8 - In the instant case, assessee
disputed its liability to pay tax on the glass bottles and crates
used for beverages sold by it - However, it had itself
mentioned in its accounts the turnover in respect of rent
charged by distributors of glass bottles and crates - The said
F
issue was decided in the case of Asiatic Gases Ltd. wherein
it was held that tax was payable on rentals charged in respect
of containers for goods that cannot be sold without containers
- Thus, interest is payable in terms of sub-section (1) of s.8
and not in terms of sub-section (18) of s.8.
G
s.8(1) - Interest on delayed payment of tax - Whether
payable from the {late whfin the tax became due and payable
or from the date of the assessment order - Held: Where a
n3
H
724
SUPREME COURT REPORTS
[2011] 4 S.C.R.
A dealer fails to pay tax at the correct rate because he claimed
not to know the revision in the rate, the dealer remains liable
to pay interest at a penal rate uls. 8 (1) from the date when the
tax became due and payable - In such a case, the dealer
cannot claim that he is liable only from the date of the
s assessment order fixing the correct rate of tax.
s. 3-F - Rent charged in respect of glass bottles and
crates us~d for beverages sold by assessee - Liability to pay
sales tax on - Held: Glass bottles and crates constitute an
integral part of the beverages and they together with the
C contents therein are a "composite personality" and constitute
"goods" liable to sales tax - Sales tax.
Words and phrases: Expression "the tax admittedly
payable" - Meaning of, in the context of s.8(1) of the U.P.
D Trade Tax Act.
The appellant was engaged in the manufacturing and
selling of the beverages and owned bottling plants in the
State of Uttar Pradesh. The dispute pertained to the trade
E tax payable on its turnover of ? 8.54 crores in respect of
rentals by distributors of glass bottles and crates for the
assessment year 1999-2000. The appellant disputed the
tax liability on such turnover as well as the interest, as
according to them no tax was payable on the rental of
glass bottles and crates as the same did not amount to
F a transfer of right to use the goods for value or
consideration under section 3-F of the U.P. Trade Tax Act.
However, the said submission was negated by the first
and second appellate authority as well as, on revision, by
G
H
the High Court.
The issue as to whether there was transfer of rights
of users by the assessee when he realized rental charges
for glass bottles and crates was dropped by the assessee
as, in the intervening period, the issue was finally settled
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PEPSICO INDIA HOLDINGS LTD. v. COMMNR. OF TRADE 725
TAX, LUCKNOW
by judgment of Supreme Court in *Asiatic Gases Ltd.
A
wherein it was held that the containers constituted an
integral part of t.he commodities in question and the
container together. with the contents therein was a
''composite personality" and constituted "goods" eligible
to sales tax. The only issue which was under B
consideration in the instant appeal .was whether the
appellant was liable to pay .interest on the delayed
payment of tax under Section 8(1) of the U.P. Trade Tax
Ac! i.e. @ 2% per mensem from the date the tax was due
or under Section 8(1 B) i.e. 1.5% per mensem from the c
date of the assessment order and demand notice.
Dismissing the appeal, the Court
HELD: 1. The explanation to the sub-section (1) to
section 8 of the U.P. Trade Tax Act clearly defined the
D
term "the· tax admittedly payable" andExcerpt shown. Read the full judgment & AI analysis in Lexace.