Law:

Section:

Sales Tax Act (VII of 1990)--- ----Ss. 3, 6, 7 & 34---Scope of tax---Tax was charged on sale of plant and machinery, vehicles, furniture, office equipment, scrap etc., whereas assessee's normal business was supply of textile products, beverages, dairy products etc.---Validity---Assessee claimed input tax credit on most of these goods in terms of S.7 of the Sales Tax Act, 1990 and while claiming input tax credit, assessee's plea was that since the said goods were required for running their business they were entitled to deduct input tax from the output tax for determining their tax liability--­Assessee could not take a different stance which ran contrary to their earlier assertion---If the purchase of the said goods was in the course of their taxable activity, their sale could not be viewed differently as a transaction which was divorced from their normal business---Held, sale of plant and machinery, furniture, office equipment etc. was a taxable transaction and assessee was under a legal obligation to account for these transactions and pay sales tax thereon---Not just and fair to charge sales tax on sale of vehicles and such other goods which were not admissible for input tax deduction in terms of S. 8(1)(b) of the Sales Tax Act, 1990---"Sale and lease back" of machinery and other goods being a fictional transaction it did not fall within the purview of the tax net and. thus sales tax was not chargeable thereon---Controversy between the Department and the assessee related to interpretation of different legal provisions the imposition of additional tax and penalty had no justification and the same was accordingly waived. JUDGMENT FALAK SHER, MEMBER (TECHNICAL). ---By this order we will dispose of the appeals listed above. 2. The charge against the appellant is that they sold plant and machinery, vehicles, furniture, office equipment, scrap etc. but did not pay sales tax thereon. They were accordingly charged with violation of sections 3, 6, 7 and 34 of the Sales Tax Act, 1990 (hereinafter referred as the Act) and show-cause notices were issued to them for the recovery of sales tax chargeable on the said goods alongwith additional tax and penalty under the…

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