Almonard Limited Vs Commercial Tax Officer (Madras High Court)
The Madras High Court recently affirmed a sales tax tribunal’s decision that air curtains are not the same as electrical fans for taxation purposes. In the case of Almonard Limited v. Commercial Tax Officer, the court dismissed a petition by Almonard Limited, a company that sells air curtains. Almonard had argued that its products should be taxed at 8%, the rate applicable to electrical fans under Entry 17 of Part C of the Tamil Nadu General Sales Tax Act, 1959.
The Commercial Tax Officer and the Sales Tax Appellate Tribunal, however, had classified air curtains under Entry 22 of Part DD of the same Act, which imposes a higher tax rate of 12% on a broader category of electrical appliances not specified elsewhere. The Tribunal’s reasoning, which the High Court upheld, was that an air curtain is more than just a fan. It is a specialized piece of equipment designed to create an “environmental separation.” By blowing a constant sheet of air across an open doorway, it minimizes the loss of conditioned air (either heated or cooled) from a building and also acts as a barrier against insects, dust, and rain.
