2025-VIL-1356-ALH
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VAT High Court Cases

Central Sales Tax Act, 1956 - Manufacture and sale of earth moving equipment, Replacement of Parts During Warranty Period – During the warranty period, the revisionist-assessee replaced certain defective parts in the equipment sold to customers without charging any consideration - The Assessing Authority levied tax on the value of replacement parts, which was upheld by the Tribunal by relying on the Supreme Court judgment in Mohd. Ekram Khan and ignoring the judgment in Tata Motors Limited v. The Deputy Commissioner of Commercial Taxes - Whether the Tribunal was legally justified in imposing tax on the parts replaced free of cost during the warranty period – HELD - The finding of fact recorded by the lower authorities that the revisionist-assessee had realised amounts from customers for the replacement parts and had not provided details of the parts used against the supply of particular machinery to particular customers. This finding of fact, which was not challenged, showed that there was a consideration involved in the replacement of parts, and thus it could not be said that the parts were provided free of cost - The judgment of the Supreme Court in Tata Motors Limited Taxes squarely covered the issue in favor of the revenue. The mere assertion that no credit note was issued and no amount was charged from the customer or dealer is of no help to the revisionist, as the finding of fact recorded against the revisionist that some money had been charged could not be disputed without any cogent material - No interference is called for in the impugned order, and the questions of law were answered in favour of the Revenue - The revision petitions are dismissed
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