Law: Sales Tax Act, 1990

Section: 11,36

(a) Collection and Payment of Sales Tax on Natural Gas Rules, 1999---Rr. 2(d)(e) & 3(2)(ii)(v)-Sales Tax Act (VII of 1990), Ss. 11 & 36--- Liquified Petroleum Gas (LPG)---Liability to charge and pay sales tax--­Supply of LPG from bore-holes by appellant-Corporation --- Show -cause notice for recovery of sales tax and penalty---Contention of appellant was that only dealer, distributor/retailor of LPG was liable to charge: collect/deposit sales tax and appellant being its producer was not liable for same---Validity---Person responsible to charge and pay sales tax in case of production and supply from bore-holes and wells would be the person making supply at bore heads and wells---LPG was originally a natural gas produced and supplied from bore-holes and wells---Such ges was liable to be charged with sales tax, which was responsibility of appellant-Corporation being its producer and supplier from wells--­Natural gas after its conversion into LPG was disposed of by dealers, distributors and retailers to make same available to consumers---Dealers, distributors/ retailers of LPG were responsible to charge/collect/deposit sales tax upon supply made by them---Incidence of charging and payment of sales tax provided in R.3(2) of the Collection and Payment of Sales Tax on Natural Gas Rules, 1999 for different eventualities was separate and distinct from each other----Default by appellant was deliberate as there was no ambiguity or confusion in matter---High Court dismissed appeal in circumstances. (b) Collection and Payment of Sales Tax on Natural Gas Rules, 1999---- ----R.2(d)---Natural gas---Liquefied Petroleum Gas (LPG) ---Distinction-­LPG is natural gas .in essence---Natural gas is in gaseous form, which is later subjected to process of condensation in condensate plant and is converted into a liquefied. form, in which form and shape same remains only in thick walled steel cylinders---LPG base stock prepared in condensate plant is then transported to various gas plants for filling in cylinders and supply to LPG consumers. ORDER Brief facts of the case are that upon a report made by Assistant Collector (External Audit) Collectorate of Sales Tax and Central…

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