Emery cloth & tarpaulins were exempt from taxation under APGST Act: HC

State of Andhra Pradesh Vs Mohsin Brothers (Andhra Pradesh High Court)

Whether the first sales of emery cloth and tarpaulins are not excisable to the tax under Andhra Pradesh General Sales Tax Act (APGST Act)?

The case involves M/s. Mohsin Brothers contesting the assessment by the Commercial Tax Officer regarding the sale of emery cloth and tarpaulins under the Andhra Pradesh General Sales Tax Act (APGST Act). The assessment initially taxed the turnover of emery cloth as an unclassified item and tarpaulins under a specific item. The matter was appealed and ultimately brought before the Andhra Pradesh High Court.

The High Court upheld the decision of the Appellate Tribunal, which ruled that emery cloth and tarpaulins were exempt from taxation under the APGST Act. The Tribunal determined that emery cloth falls under a specific category exempted from tax due to its classification under the Additional Duties of Excise Act. Similarly, it found that tarpaulins, despite being included in a taxable category, were exempt as they fell under the definition of cotton fabrics, which are exempt from taxation.

The court referenced previous cases and statutory provisions to support its decision, emphasizing that the inclusion of these items in certain schedules or categories did not affect their exempt status. The ruling dismissed the Tax Revision Case filed by the State, concluding that no legal errors were made in the Tribunal’s decision.

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