Allowed

M/S.Indian Tourism Development Corpn.Ltd., Secunderabad v. the Asst.Commissioner, (Ct), Begumpet , Hyderabad and Another

Telangana HC15 Nov 2022WP/5963/2008

Case brief

AI extract

What is this about?

The High Court of Telangana allowed two writ petitions filed by M/s. Indian Tourism Development Corporation Ltd regarding the levy of VAT on sales of duty-free goods to international airport passengers. The court held these transactions occur outside Indian customs frontiers and are not assessable under local laws.

What did the court decide?

The writ petitions were allowed and the impugned assessment orders were set aside.

M/S.Indian Tourism Development Corpn.Ltd., Secunderabad… — Customs and Excise | Telangana HC (2022)

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I^331e I

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HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction)

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TUESDAY, THE FIFTEENTH DAY OF NOVEMBER TWO THOUSAND AND TWENTY TWO

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PRESENT

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THE HONOURABLE SRI JUSTICE T.VINOD^KUMAR AND

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THE HONOURABLE SRI JUSTICE PULLA KARTHIK

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WRIT PETITIO N NOS: 5963 AND 5992 OF²⁰⁰⁸

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w.P.NO.5963 0F 2008

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Between:

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M/S.lNDlAN TOURISM DEVELOPMENT CORPORATION^{LTD., Dutyfreeshop} HDC, Hyderabad lnternational Airport Begumpet,^{Secunderabad, rep.by its Assistant} Manager Taxation, Mr.Anil Khanna, S/o.S.L.Khanna, aged about 49^years, Hyderabad.

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...PETITIONER

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AND

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The Assistant Commissioner of Commercial^{Taxes-lll,Begumpet Division} Ameerpet, Hyderabad.

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The Commercial Tax Officer, Begumpet^{Division, Ameerpet, Hyderabad.}

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...RESPONDENTS

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Petition Under Arlicle 226 of the Constitution of lndia^{praying that in the} circumstances stated in the affidavit filed therewith, the^{HighCourt maybe} pleased to issue an appropriate writ order or direction particularly in the nature of writ of Certiorari after calling for the entire connected^{relating to the impugned} proceedings of assessment of VAT in Form VAT 305 dated 11.1.2OO8 issued in TIN 28740175287 by the Assistant Commissioner of Commercial^Taxes-lll, Begumpet Division, Hyderabad by holding the impugned^{levy and demand of} VAT on the sales of Customs Duty Free Goods effected^{to the international air} passengers in the case of export out of the territory of lndia and in the course of import inot the territory of lndia at the departure^{and arrival lounge in the} lnternational Airport, Hyderabad beyond the customs Frontiers^{of lndia under the} provisions of the Andhra pradesh, Valued Added Tax Act, 2005 for the tax^period 1.4.2005 to 31.3.2006 as illegal, arbitrary, without authority of^{law without} .jurisdiction^{ultravires section 5 of Andhra pradesh ValuedAdded Tax Act,2005}

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as also section l, of^{the Central Sales Tax Act, 1956arc violating Articles,} 286(1)(b) 265,14,rnd^l9(iXg)of the constitution^{of lndia.}

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Counsel for the P:titioner^{: SRI.M'V.J.K.KUMAR}

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Counsel for the R-'spondents^{: SRI'L.VENKATESHWARRAo}

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w.P .NO: 5992^OF2008

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Between:

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M/S. INDIAN TOUIISM^{DEVELOPIvIENT,HYD' Dutv Free Sh:p HDC, Hyderabad} lnternational Airpc t, Begumpet,^{Secunderabad, Rep by its Assistanl Manager,} Taxation, Mr.^Anil t.hanna,^{S/o. S.L. Khanna, aged 49 years, Hy'lerabad.}

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...PETITIONER

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AND

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THE ASSIS-'ANT^{COIVIIVISS|ONER,BegumpetDivision, Anreerpet,} Hyderabad.

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The Commis sioner^{Tax Officer, Begumpet Division,Ameerllet,l-lyderabad.}

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...RESPONDENTS

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Petition Un( er Article 226 of^{the Constitution of lndia} t)'aying^{that in the} circumstances sta .ed in the^{affidavitf iled therewith, theF i3 ICourtmay be} pleased to issue aT aporopriate writ, order or^{direction particLlirrly in the nature} of writ of certiora i after calling^{for the entire connected rec lrdsrelating to the} impugned^proceecings of^{assessmentof VAT in FornrVAT ll05 dated11-01-} 2gb8-issued in TIN^{28740175287 by the AssistantCommissi(,n{)r of Commercial} Taxes-lll, Begumpet Division,^{Hyderabadby holding the ilr[)ugned Ievyand} demand of VAT t,n the sales of^{Customs DutyFreegoo ls eflectedto the} international air^{pa;sengers in the case of export out of thet( rrrtor)'of lndia and} in the course of irnpost into^{the territory of lndia at the delartursand arrival} lounge in the lnlerlational Airpo(, Hyderabad^{beyond the ct t;r'oms; Frontiers of} lndii under the prcvisions of the Andhra^{Pradesh Value Adde,J lax Act, 2005for} the tax^period O1-C4-2006 to 30-09-2006^{as illegal, arbitrary, rithoLt authority of} law, without^jurisdi, tion, ultravires Section^{5 of Andhra Prade:;lt Value Aded Tax} Act, 2005 as also Section 5 of the^{CentralSales Tax Act, 1956and violating} Articles 286(1Xb), :165, l4 and^{19(i)(g) of the Constitutionof lttd a.}

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Counsel for the Pe:itioner : SRI.M.V.J.K.KUMAR

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Counsel for the Re;pondents : SRI.L.VENKATESHWAR^RAO

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The Court made th^r following^{COMMON ORDER}

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t I

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THE HON'BLE SRI JUSTICE T. VINOD KUMAR AND THE HON'BLE SRI ]USTICE PUTLA KARTHIK

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Writ Petition Nos.5963 and 5992 of 2008

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COMMON ORDER:(per Hon'ble ,ri )ustice T.Vinod Kuma)

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These writ petitions were filed^questioning the orders of assessment made under the^provisions of the Andhra Pradesh Vat Act, 2005 (for short, 'the Act') by the ln respondent authority in subjecting the sales of^goods made to international^passengers from customs duty free shops set up at the Airpot, as being liable to tax under the provisions of the Act, as without jurisdiction and contrary to provisions of Section 5 of the Central Sales Tax Act.

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When he writ petitions were taken up for hearing, learned counsel appearing for the^petitioners and Sri L.Venkateshwar Rao, learned^Special Standing Counsel appearing for the respondents, would submit that the issue raised in the present writ petitions is squarely covered by the judgment of the Hon'ble Supreme Court in Hotel Ashoka (Indian Tour Development Corporation Limited) v. Assistant Commissioner of Commerciat Taxesl, wherein it was held that the area^{which is} earmarked in the airport and whereat the^petitioner therein^{is permitted} to effect sales of customs duty free^{goocis, would} have to be^considered

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as transact ons taking place outside the custom fr)nliers of Indja, in terms of pr, rvisions of section 2(ii) of the Customs Act and Article 286 of the Constih. tion of India and therefore, would not b -, assessable to tax under the lc :al enactments.

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As th, ) issue in the present writ petitions is squarery covered by the above decisi)n of the Hon,ble Supreme Court, followirl(] the dicta as laid down there n, these writ petitions are allowed a rcl tle impugned assessment orders are accOrdingly set aside.

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4 IYiscel aneous petitions, if any, pending in these writ petitions shall stand closed. No order as to costs

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That Rule Nisi h; s been made absolute as above. Witness the Hon ble the Chief Justice UJJAL BHUYAN, on :lris Tlesday, the Fifteenth day of I lovember, Two Thousand and Twenty Twr r

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SD/-K.VEN AH ASS Si-ANT REGI RAR //TRUE COPY//

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siEc'iloN FFICER

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'1. The Assistant C ommissioner of Commercial Taxes-lll, Begurtcet Division Ameerpet, Hydr rabad.

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