Charger Not Taxable Separately When Sold With Phone Under Single MRP: SC

Naresh Kumar Gupta Vs State of Punjab & Anr. (Supreme Court of India)

Supreme Court held that when a cell phone is sold along with a charger there is only one Maximum Retail Price and hence charger cannot be taxed separately under Uttar Pradesh Value Added Tax Act, 2007 [UP VAT Act].

Facts- The issue involved herein is taxability of charger of the cell phone under Entry 28 Part B of Schedule II under Uttar Pradesh Value Added Tax Act, 2007.

Conclusion- Held that when a cell phone is sold along with a charger, there is only one Maximum Retail Price (MRP) stated on the packaging and therefore, Entry 28 has to be read in the context of the said facts. We have considered the arguments advanced at the bar, in light of the judgment of this Court in Nokia India Private Limited’s case and in light of the detailed discussion made by the High Court distinguishing the aforesaid judgment. Hence, the Special Leave Petitions are dismissed.

FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER

List on 05.03.2025 to be heard immediately after the fresh cases are heard.

SLP(C) NO. 26270-26273 OF 2019 (Item 11.3):

We have heard Mr. Yogendra Aldak, learned counsel for the petitioner(s) and Dr. Manish Singhvi, learned senior counsel for the respondent(s)-State and others.

We have perused the impugned order.

The High Court has relegated the petitioner(s) herein to the appellate authority and granted sixty days time from the date of the impugned order so as to file an appeal and agitate all questions raised by the petitioner(s) before the appellate authority. We reiterate the said order. However, we state that the petitioner(s) is granted sixty days from today to file an appeal before the appellate authority. If such an appeal is filed within the aforesaid period, the issue of limitation shall not be raised by the appellate authority or by the respondent(s) herein.

The appeal shall be heard on its own merits by taking into consideration all the contentions to be raised by the respective parties and in accordance with law.

The Special Leave Petition is disposed of in the aforesaid terms.

Pending application(s), if any, shall stand disposed of.

DIARY NO(S). 20066/2021; 20096/2021; 20110/2021; 20116/2021; 20569/2021; 20823/2021; 20825/2021 20826/2021; 20828/2021; 20832/2021; 20836/2021; 20838/2021; 19948/2021; 19951/2021; 20062/2021; 20063/2021 and 20105/2021 (ITEM NO(S).11.4 TO 11.15 AND 11.36 TO 11.40)

Despite there being delay in filing these Special Leave Petitions, we have nevertheless heard learned counsel for the petitioner(s) on the merits of these cases.

We have heard Sri Bhakti Vardhan Singh, learned counsel, who strenuously argued and placed reliance on the judgment of this Court in the case of State of Punjab and others vs. Nokia India Private Limited (2014) 16 SCC 410.

We have considered the said judgment relied upon by learned counsel for the petitioner(s) in light of Entry 28 Part B Schedule II of the Uttar Pradesh Value Added Tax Act, 2007, which, for the sake of immediate reference, is extracted and reads as under:

We have heard learned counsel for the respondent(s)-assessees, who have supported the impugned judgment and have contended that the judgment of the Allahabad High Court is just and proper and has correctly distinguished the judgment of this Court in Nokia India Private Limited’s case (supra). It was submitted that when a cell phone is sold along with a charger, there is only one Maximum Retail Price (MRP) stated on the packaging and therefore, Entry 28 has to be read in the context of the said facts.

We have considered the arguments advanced at the bar, in light of the judgment of this Court in Nokia India Private Limited’s case (supra) and in light of the detailed discussion made by the High Court distinguishing the aforesaid judgment.

We do not find any reason to interfere with the impugned order.

Hence, the Special Leave Petitions are dismissed.

We clarify that this order is not applicable to a case where a charger is sold de hors a mobile phone and separately by itself.

In view of the aforesaid order, the applications seeking condonation of delay in filing the Special Leave Petitions and other pending application(s), if any, shall stand disposed of.