M/S Sony India Pvt.Ltd vs Commercial Tax Officer & Anr

Appellant had a factory at Dharuhera, Haryana wherein it was manufacturing, inter alia, Televisions, Audio systems, Walkman-Pocket size Radio Cassette Player, which apart from being sold locally, were branch transferred to various States wherein local sales were made. They also imported certain items from abroad either at New Delhi or at Mumbai and after filing Bills of Entry for home consumption, paid customs duty and cleared the goods. The goods were thereafter branch transferred to their warehouses located in different parts of the country including Tamil Nadu. Prior to the period in question, appellant's products, both indigenously produced as well as those imported from outside India, were assessed under Entry 14(vi) and (viii) of Part D of the First Schedule to the Tamil Nadu General Sales Tax Act, 1959. They were, accordingly, taxed at 12% at the point of first sale in the State of Tamil Nadu. However, in 2002, an amendment was made for the first time and 'imported' goods falling in Part D of the First Schedule of the Act 1 were sought to be taxed at enhanced rate of 20%. Appellant sought a clarification from the Commissioner under Section 28-A of the Act. While the clarification was pending, the appellant challenged the said amendment vide O.P.Nos.969-970/2002 before the Tamil Nadu Taxation Special Tribunal constituted under the Tamil Nadu Taxation Special Tribunal Act, 1992 in terms of Article 323B of the Constitution. One of the grounds of challenge was that there was no distinction between imported goods and indigenously manufactured goods particularly when they answer the same description, more so since the goods after import became part of the landmass of India. The appellant also alleged that identical goods manufactured by multinational corporations like LG, Samsung etc. were also subjected to levy of 12% only, since the said multinationals (who were competitors of the appellant) produced those goods in India. The Tribunal dismissed the O.Ps. against which Writ Petitions were filed by the appellant which were also dismissed by the High Court by the impugned judgment, hence these Civil Appeals.

record changers, sound recording and reproducing equipments including dicta-phones, car cassette players, tape-decks, tape players, compact disc players (including a combination of any of them) with or without wireless reception instrument and pagers[xxx]@.

We do not wish to comment about the above contentions. Suffice it to state that these contentions would require adjudication, which has not taken place in the present case. Against the assessment orders, the assessee chose to move the Tribunal without exhausting statutory remedy under the Act. In our view, looking to the contentions advanced by the assessee, they ought to have proceeded to file appeals for each assessment year before the First Appellate Authority under the Act which they have failed to do. However, since an important question of law arises for determination and since the liability is likely to recur in future, we direct the appellant-assessee herein to prefer statutory appeal(s) within a period of four weeks. It is made clear that the First Appellate Authority will decide the said appeal(s) 4 within a period of six months, uninfluenced by the observations made by the Tribunal as well as by the High Court in the impugned judgment. We express no opinion on the merits of the case. Whatever is stated hereinabove is only in the support of our order remitting the matter to the First Appellate Authority and that Authority shall not be bound by any of our observations mentioned hereinabove. The First Appellate Authority shall decide the matter on merits and it shall condone the delay, if any, in filing the appeals.

Civil Appeals are disposed of accordingly.

No order as to costs.