M/S.Bharat Heavy Electricals Ltd. Vs the Sales Tax Appellate Tribunal — Telangana HC (2025) — LawSathi Research

M/S.Bharat Heavy Electricals Ltd. Vs the Sales Tax Appellate Tribunal — Telangana HC (2025) — LawSathi Research

What the court decided

AI extract

Outcome

Tax Revision Case allowed: both questions of law answered in favour of the assessee - goods held to be mechanical goods under Entry 83 of the I Schedule of the APGST Act (not electronic goods under Entry 38), and the assessee upheld as entitled to concessional rate @4% on Rs.12,02,62,168/- for which 'C' forms were accepted; claim on Rs.58,20,549/- (no 'C' forms) closed on petitioner's concession. No order as to costs; pending miscellaneous petitions closed.

Issue for consideration

Whether the goods produced/manufactured by the petitioner-establishment are to be treated as electronic goods covered at Entry 38 of the I Schedule, or as machinery/mechanical goods falling under Entry 83 of the I Schedule, of the APGST Act. +1 more

Court's answer

The first question of law is decided in favour of the petitioner-assessee: the goods manufactured by the petitioner-establishment are to be treated as mechanical (machinery) goods falling under Entry 83 of the I Schedule of the APGST Act, not as electronic goods under Entry 38; the question being no longer res integra in view of prior decisions in TREVC.Nos.39-41 of 2005 and TREVC.No.34 of 2004 rendered in favour of the same assessee.

Ratio / Principle

Since 'C' forms for the amount of Rs.12,02,62,168/- were submitted (though belatedly) and their availability was accepted by the Commercial Tax Officer in his order dated 23.07.2003, the petitioner cannot be forced to pay tax on that amount at the enhanced rate when it is duly entitled to the concessional rate.

Key takeaways

The claim for concessional tax on the amount of Rs.58,20,549/- is not pursued by the petitioner (who conceded that it does not have the 'C' forms for that amount), and that sub-issue accordingly stands closed.ratio¶57
The second question of law stands answered in favour of the petitioner/assessee and against the Revenue.ratio¶61

Detailed headnote1 paragraphs

Telangana HC (Bench: P. Sam Koshy (author) and S. Chalapathi Rao; order dated 02.09.2025), TREVC.No.111 of 2009 under S.22(1) APGST Act, 1957: M/s Bharat Heavy Electricals Ltd, Ramachandrapuram (assessee/petitioner) v. State of Andhra Pradesh (Revenue/respondent), assailing the order dated 24.10.2008 of the Sales Tax Appellate Tribunal, Hyderabad in T.A.No.195 of 2001, whereby the Tribunal had partly allowed the assessee's claim. Two questions of law: (i) whether the goods manufactured by the petitioner-establishment are electronic goods under Entry 38 of the I Schedule or machinery/mechanical goods under Entry 83 of the I Schedule of the APGST Act - held, no longer res integra; following this Court's earlier decisions in TREVC.Nos.39, 40 and 41 of 2005 (dt. 03.03.2005) and TREVC.No.34 of 2004 (dt. 28.05.2025, endorsing the earlier view), the goods are mechanical goods falling under Entry 83 of the I Schedule of the APGST Act, not electronic goods under Entry 38; (ii) invoices totalling Rs.10,85,47,685/- not supported by 'C' forms, which the authorities had subjected to higher-rate taxation - the CTO's fresh assessment order dated 23.07.2003 (passed after remand following the revisional authority order dt. 16.12.2000 and appellate authority order dt. 11.02.1999) had accepted the belatedly-produced 'C' forms and assessed Rs.12,02,62,168/- at the concessional rate of 4%, denying concession only on the remaining turnover (Rs.58,20,249/- per the assessment order; Rs.58,20,549/- per the hearing record) for want of forms, for which the petitioner conceded non-pursuit. Held: the assessee cannot be forced to pay tax at the enhanced rate on the amount for which 'C' forms stand accepted; second question answered in favour of the assessee and against the Revenue. Tax Revision Case allowed; no order as to costs; pending miscellaneous petitions closed.

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IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD

TUESDAY, THE SECOND DAY OF SEPTEMBER TWO THOUSAND AND TWENTY FIVE

PRESENT

THE HON'BLE SRIJUSTICE P.SAM KOSHY AND

THE HON'BLE SRt JUSTTCE SUDDALA CHALAPATHI RAO

Tax Revision Case under Section 22(1) (See Rule 40) of the Andhra pradesh General Sales Tax Act, 1957 to revise the order dated 24-10-2o}g passed in T'A.No.195 of 2oo1 on the file of the Sales Tax Appellate Tribunat, Andhra pradesh, Hyderabad

Between:

lt//s. Bharat Heavy Electricars Ltd, Ramachandrapuram, Hyderabad, rep by sri

G.V.S.Sharma, Finance Manager.

...petitioner

AND

The State of Andhra Pradesh, rep. by its State Representative, Sales Tax

.Appellate Tribunal, Ground Floor, c.r. auitoing, Nampally, Hyderabad.

...Respondent

Counsel for the Petitioner: Mr. G. Narendra Chetty

Counsel for the Respondent: Sri Swaroop Oorilla,

Special Govt^pleader for State Tax

The Court made the foltowing: ORDER

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THE HONOURABLE SRI JUSTICE P.SAM KOSHY AND

THE HONOURABLE SRI JUSTICE S. CHALAPATHI RAO

ON r11 0F 2

ORDER: (per Hon'ble Sri Justice P.Sam Koshy)

Heard Mr. G. Narendra Chetty, leamed counsel for the petitioner and Mr. Swaroop Oorilla, learned Special Government Pleader for State Tax, appearing for the respondent. Perused the record.

The instant is a tax revision case preferred by the assessee assailing the order dated 24.10.2008 passed by the Sales Tax Appellate Tribunal, Hyderabad (for short, 'the Tribunal') in T.A.No.l95 of 2ool.

vide the impugned order, the learned rribunal had partly allowed the claim of the assessee.

The order of the Tribunal was subjected to challenge finally on two grounds; firstly, determining before the goods produced by the petitioner establishment is one which needs to be treated as electronic goods covered at Entry 38 of I Schedule or whether they are machinery goods falling under Entry 83 of I Schedule. The second question of law was pertaining to the invoices not supported by 'C' forms pertaining to an amount of Rs.10,85,47,685/-, which according to the authorities was

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liable to be taxed at higher rate on the ground the petitioner had not produced the 'C' forms and that they are treated as electronic goods

So far as the first question of law, as to whether the goods manufactured by the petitioner-establishment be treated as electronic goods or the machinery goods is concerned, we are of the considered opinion that the said question of law is no longer res integra for the reason that in respect of the petitioner-assessee itself there have been decisions passed on this very issue. Recently, in TREVC.Nos.39, 40 and 4l of 2005, decided on 03.03.2005, it was categorically held that the goods manufactured by the petitioner-establishment would be machinery under the mechanical goods falling under Entry 83 of I Schedule of the APGST Act, further holding that it would not be electronic goods under Entry 38 of I Schedule. The said decision of this High Court was based upon an earlier decision and the said view was further reiterated in yet another TREVC.No.34 of 2004, decided on 28.05.2025, wherein, the earlier view of this High Court was endorsed.

[n view of the aforesaid two batch of petitions being decided in favour of the assessee, we are of the considered opinion that the first question of law raised in this tax revision case also deserves to be and is

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accordingry decided in favour of the petitioner-assessee holding that the. goods manufactured by the petitioner-estabrishment are to be treated as mechanical goods falling under Entry 83 of the I Schedule of the APGST Act.

7' Now we come to the second question of raw so far as the matters pertaining to the invoices non-supported with ,c, forms. The Iearned Tribunar as arso the divisionar authority had not accepted the contention of the petitioner on the sore ground of the petitioner having non-supportive invoices with .c, forms. However, what is apparentry evident from the materiars placed before the Bench in the course of the hearing is that in spite of the revisional authority order dated 16'12'2000 and the apperate authority order dated r r .02.r 99g, after the matter was remanded back, the commerciar Tax officer, in the course ofpassing fresh assessment order on23.07.2003,whire dearing with the declaration forms, held as under:

The Assessee Company filed details of ,C/D, declaration forms arong with originat poiis of 'clD, decraration forms for a turnover of Rs. 12,60,g2,417/. venfred the declaration forms with reference to the deta,s and found that a turnover of Rs. 12,02,62:16g/ is eligible for concessional rate of tax @ 4%. As such, the turnover of

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Rs.[2,02,62,1681- is now assessed to tax at concessional rate of 4Yo. The remaining turnover of Rs.58,20,2491- is not considered for concessional rate of4o/o, in the absence of 'CID' declaration forms".

Today, when the matter is taken up for hearing,^{learned counsel} appearing for the petitioner submits that the order of^{the Commercial} Tax Officer in refusing to tax at concessional tax @^{4o/o, to an amount} of Rs.58,20,5491-is concerned, the^{petitioner is not challengingthe} same for the reason that they are not in^{a positionto make available'C'} forms for the said amount. Nonetheless so far^as the^{amount of} Rs.12,02,62,1681- is concerned, where the^{AssessingOfficer, in the} course of passing the fresh assessment^{order has found that the} petitioner has been successful in producing the^'C' forms^pertainingto the said amount and has ordered for taxing^{the same at concessionrate} @^{4yo, the order of the Tribunal as also the order of the divisional} authority may not be detrimental^{to the petitionerand he will be forced} to pay tax at a higher rateⁱⁿ spite of^{having submitted 'C' forms for the} said amount.

Learned Special Government Pleader^{for State tax, though on} perusal of the order of the Commercial Tax Officer dated^23.07.2003, accepts the fact that the petitioner has in^fact been^{able to produce 'C'}

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declaration form for an amount of Rs. 12,02,62,168/-. He expressed his reservation to the Assessing officer having accepting the same in the teeth of the revisional authority order dated 16.12.2000. He further submits that now that the fresh assessment order has been passed and the commercial rax officer has accepted the 'c' form submitted by the petitioner and has also ordered them to be taxed at a concessional rate, perhaps the order of the Tribunal as also the order of the revisional authority, to the aforesaid extent becomes inconsequential.

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In view of the aforesaid factual matrix of the case, we are of the considered opinion since the learned counsel for the petitioner has conceded to the effect of not pursuing the claim of concessional tax for an amount of Rs.58 ,20,5491-, as admittedly the petitioner did not have I the 'C' forms for the said amount, that issue stands closed accordingly. Nonetheless, so far as the amount of Rs.12,02,62,16g/- is concerned, since the petitioner has admittedly submitted^,c, forms though belatedly, but apparently 'c' forms were available. In view of the fact that 'c' forms for the aforesaid amount of Rs. 12,02,62,16gl- is available with the authorities as has been accepted by the cro in his srder dated 23.07.2003, the petitioner cannot now be forced to pay tax I I

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on the said amount at the enhanced rate when otherwise they are duly entitled for the tax at concessional rate. Accordingly, we are not inclined to pass any further orders in the instant Tax Revision Case. The second question of law raised also stands answered in favour of the petitioner/assessee and against the Revenue.

The Tax Revision Case, accordingly, stands allowed. There

shall be no order as to costs.

Consequently, miscellaneous petitions pending, if any, shall

stand closed.

Sd/. K.SHYLESI
JOINT REGISTRAR

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//TRUE COPYII

OFFICER

To,

The Sales Tax Appellate Tribunal, Telangana, Hyderab 2. One CC to Mr. G. Narendra Chetty Advocate IOPUC] 3. Two CCs to GP FOR TAX, High Court for the State of Telangana at Hyderabad. [OUT]

Two CD Copies

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HIGH COURT

DATED:0210912025

ORDER

TREVC.No.111 of 2009

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ALLOWING THE TRC

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