Central Sales Tax Act, 1956

The appellant, a partner in a firm assessed under the Bombay Sales Tax Act, 1959, claimed that a settlement with the State Minister for Finance had discharged his individual liability for the firm’s tax dues, and that the Commissioner had acted on this settlement. The Revenue contested the existence and effect of such …

Mis. Casio India Co. Pvt. Ltd., a manufacturer of radio pagers in Haryana, claimed exemption from Central Sales Tax (CST) on inter‑state sales of goods it purchased from another dealer holding a valid exemption certificate under Rule 28A. The State of Haryana rejected the claim, contending that the exemption applied on…

The Commissioner of Commercial Taxes of Kerala challenged a penalty of Rs.86 lakh imposed on K.T.C. Automobiles for allegedly evading Kerala sales tax by registering 263 cars sold from its Mahe branch under the Pondicherry Sales Tax Act. The High Court set aside the penalty, holding that the sale was completed at Mahe …

The Commercial Taxes Officer challenged the exemption claimed by M/s Bombay Machinery Store under Section 6(2) of the Central Sales Tax Act, 1956, arguing that the State’s circulars imposed a 30‑day time‑limit after which goods retained by a carrier were deemed to be constructively delivered, converting the inter‑state…

The Supreme Court considered a contempt petition filed by JSW Steel Ltd., which had become the successful resolution applicant for the insolvent Monnet Ispat and Energy Ltd. After the National Company Law Tribunal approved the resolution plan, the State of Chhattisgarh issued demand notices for sales tax, VAT and entry…

The State of Jharkhand issued Notification S.O. No.25 on 25 June 2001 reducing the Central Sales Tax rate to 3% for the "sale of all types of glass and glass sheets" in interstate trade. M/s Laopalarg Ltd., a manufacturer of glassware, claimed that its products fell within the "types of glass" and therefore were eligib…

M/s Bansal Wire Industries Ltd., a manufacturer of stainless steel wire, challenged the assessment that taxed its product at 4% under the Central Sales Tax Act, arguing that stainless steel wire is a "declared commodity" within the "iron and steel" category of Section 14(iv) and thus eligible for the 4% ceiling. The St…

The respondents, manufacturers of notified chemicals, were granted Recognition Certificates under Section 4‑B of the Uttar Pradesh Trade Tax Act, 1948, allowing them to purchase high‑speed diesel oil (HSD) at a concessional tax rate. In 2000 the State issued a circular and show‑cause notices directing the deletion of H…

The State of Tripura issued a 1992 memorandum requiring ONGC, GAIL and FCI to deduct 4% sales tax at source when paying vehicle suppliers who had hired the vehicles. The suppliers challenged the validity of sub‑rule (2) of Rule 3A of the Tripura Sales Tax Rules, claiming it was ultra vires the Tripura Sales Tax Act and…

M/S Mamta Surgical Cotton Industries, a dealer under the Rajasthan Sales Tax Act, purchased raw cotton and processed it into surgical cotton. The assessing authority taxed the surgical cotton at 4% for AY 1992-93, treating it as a separate commodity, and the Rajasthan Tax Board upheld this view for AY 1993-94 to 1998-9…

Tata Motors sold buses through its RSO in Vijayawada to the Andhra Pradesh State Road Transport Corporation, a transaction that was held to be an inter‑state sale liable to central sales tax (CST) in the State of Jharkhand. Tata Motors, treating the sale as a stock transfer, paid the CST to the State of Andhra Pradesh,…

The appeal concerned the taxability of pan masala containing tobacco (gutka) under the Delhi Sales Tax Act, 1975, the U.P. Trade Tax Act, 1948 and the Tamil Nadu General Sales Tax Act, 1959. The central issue was whether the specific entry introducing "Pan Masala and Gutka" in the rate schedule overrode the general exe…

The State of Tamil Nadu introduced an interest‑free sales‑tax deferral scheme for expansion or diversification units under GO No. 119 dated 13 April 1994, requiring manufacturers to meet a Base Production Volume (BPV) and a Base Sales Volume (BSV) before enjoying deferral. India Cements Ltd. claimed the benefit after r…

Larsen & Toubro Ltd. filed returns under the Bihar Finance Act, 1981 for AY 1991‑92 and received an assessment order in 1996. An audit by the Auditor General identified an exemption of Rs 3.12 crore for consumables that, in the auditor’s view, should have been taxed, leading to a show‑cause notice in 2000 and a re‑asse…

The State of Haryana withdrew the sales‑tax exemption for solvent‑extraction plants by placing the industry in a negative list on 16‑12‑1996, after Mahabir Vegetable Oils Pvt. Ltd. had invested in setting up such a plant based on an earlier promise of exemption. The respondent claimed entitlement to the exemption on th…

The appellants imported cigarettes, stored them in a bonded warehouse in West Bengal and sold them to the master of a foreign‑going ship as ship stores without paying customs duty. They claimed the sales were "in the course of import" and therefore exempt from West Bengal sales tax under the 1954 and 1994 Acts. The Cou…

The Supreme Court examined whether mobile service providers (MSPs) could claim CENVAT credit on excise duties paid for mobile towers and prefabricated buildings (PFBs) used in their networks. The dispute arose from conflicting decisions of the Bombay High Court, which held the towers and PFBs to be immovable property a…

The State of Uttar Pradesh rescinded a 1998 notification that granted a tax rebate to cement manufacturers using fly ash, by issuing a 2004 notification. Birla Corporation Ltd. and Jai Prakash Associates Ltd., which had set up units and begun production before the 2004 rescission, claimed that the rebate entitlement fo…

The State of Maharashtra challenged a Bombay High Court order that had set aside a tax assessment and demand notice issued to Greatship (India) Ltd. under the Maharashtra Value Added Tax Act, 2002 and the Central Sales Tax Act, 1956. The assessee had filed a writ petition under Article 226 of the Constitution without f…

Indure Ltd. was awarded a turnkey contract by NTPC to erect an ash‑handling plant. To fulfil the contract it imported MS pipes and other components, which were sold to NTPC. The company claimed exemption from sales tax under Section 5(2) of the Central Sales Tax Act, 1956, arguing that the sale was in the course of imp…

The appellant, Trimurthi Fragrances, challenged the levy of sales tax by Delhi, Uttar Pradesh and Tamil Nadu on pan masala containing tobacco and gutka, arguing that the product is covered by an entry in the First Schedule of the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (ADE Act) and therefor…

The Additional Commissioner of Commercial Taxes allowed exemption on sales of polished granite stones, but later reopened the assessment and disallowed the exemption, contending that polished and unpolished granite fall under separate entries of the Karnataka Sales Tax Act. The assessee argued that polished granite sto…

M/S Southern Motors, a registered dealer under the Karnataka Value Added Tax Act, 2003, issued tax invoices for vehicle sales and later granted post‑sale discounts through credit notes, retaining only the net amount. The Assessing Authority disallowed deduction of these discounts from total turnover, insisting that a d…

The Supreme Court examined whether Ultratech Cement Ltd. was entitled to a 75% capital investment subsidy under the Rajasthan Investment Promotion Scheme, 2003 (RIPS-2003) for its Kotputli cement plant. The Court held that the scheme’s sub‑clauses (vi) and (vii) granting 75% subsidy were deleted before the company’s ap…

J.K. Lakshmi Cement Ltd. appealed against the Commercial Tax Officer, Pali, contending that it could claim a dual benefit – the partial exemption under Notification dated 06.05.1986 and the reduced 6% tax rate under Notification dated 21.01.2000 – relying on a 1994 circular that had been withdrawn in 2001. The Court ex…

The State of Rajasthan challenged the validity of sub‑rule (20) of Rule 17 of the Central Sales Tax (Rajasthan) Rules, 1957, which allowed the cancellation of Form C declarations issued by dealers on grounds of fraud or misrepresentation. The High Court held that the State lacked authority to make such a rule because i…

M/S S.S. Engineers, an operational creditor, filed a petition under Section 9 of the Insolvency and Bankruptcy Code (IBC) to initiate a Corporate Insolvency Resolution Process (CIRP) against Hindustan Petroleum Corporation Ltd.'s subsidiary, HPCL Biofuels Ltd (HBL). The National Company Law Tribunal (NCLT) admitted the…

Indian Oil Corporation Limited (IOCL) imports crude oil into Bihar, refines it and sells petroleum products to two oil marketing companies (BPCL and HPCL) and to local retailers. IOCL pays Entry Tax when the products enter the Patna local area but claims that Value Added Tax (VAT) should be set off against this Entry T…

Azad Coach Builders was contracted by an exporter to fabricate bus bodies according to a foreign buyer’s specifications, after which the bodies were mounted on chassis and exported as complete buses. The assessee claimed exemption from State sales tax under Section 5(3) of the Central Sales Tax Act, arguing that the sa…

United Spirits Ltd., a manufacturer of beer and Indian Made Foreign Liquor, challenged the levy of entry tax by the State of Madhya Pradesh for the period April 2007 to March 2008, arguing that the State Government warehouses, not the manufacturers, caused the entry of goods into the local area and that no notification…

M/s Vellanki Frame Works imported timber and claimed exemption from Central Sales Tax under Section 5(2) of the CST Act, arguing that the goods were sold on the high seas to end‑buyers before crossing India’s customs frontiers, making the sale a "sale in the course of import". The Commercial Tax Officer and the High Co…

The Supreme Court examined whether an Official Liquidator, appointed to wind up Premier Cable Company Ltd., qualifies as a "dealer" under the Kerala General Sales Tax Act, 1963 and consequently bears sales tax liability on the auction sale of the company's assets. The Court held that the liquidator, by stepping into th…

The appellants, exporters of tea, bought tea at open auction from planters and exported it, claiming exemption from sales tax under section 5(3) of the Central Sales Tax Act, 1956. The assessing authority accepted the exemption claim as genuine but denied a refund of tax paid to the seller, holding that only the dealer…

The appellant, ALD Automotive Pvt. Ltd., a registered dealer under the Tamil Nadu Value Added Tax Act, 2006, claimed input tax credit (ITC) for tax paid on vehicle purchases but could not do so in the original assessment year because tax invoices were delayed. It later filed revised returns claiming ITC, which the Comm…

The appellants, registered dealers under the Tamil Nadu Value Added Tax Act, challenged the denial of input tax credit (ITC) on inter‑state sales where Form C was not filed, contending that Section 19(5)(c) of the Act and Rule 10(9)(a) of the Rules were unconstitutional. The Supreme Court held that the provision is a v…

Prism Cement Ltd., a unit that had been granted an absolute tax exemption under the Package Scheme of Incentives 1993 (PSI 1993) through an Eligibility Certificate (20‑02‑1998) and an Entitlement Certificate (24‑03‑1998), challenged the Maharashtra State's attempt to withdraw that benefit after the Finance Act, 2002 am…

Tata Steel Ltd. had been granted an eight‑year sales‑tax exemption under the Bihar Industrial Policy (1995‑2000) and enjoyed the benefit from August 2000 to March 2006. When the Jharkhand Value Added Tax Act, 2005 came into force, the exemption was withdrawn and the company applied to convert the remaining exemption pe…

The Supreme Court, by a 9-judge bench, answered a reference on the interpretation of Articles 301-304 of the Constitution concerning the validity of entry taxes levied by states. The majority held that taxes simpliciter are not within the contemplation of Part XIII of the Constitution, and the word 'free' in Article 30…

The Supreme Court examined whether iron and steel reinforcement used in building works contracts retains its identity as "declared goods" under the Central Sales Tax Act, 1956, and consequently whether it is taxable at the restricted 4% rate prescribed in Section 15. The Court held that the 46th Constitution Amendment …

The dealers, M/s Sanjiv Fabrics, were registered under the Central Sales Tax Act, 1956 and authorized to issue Form ‘C’ for importing cotton and cotton yarn. They used Form ‘C’ to import cotton waste, polythene, sutli and tat, which were not covered by their registration certificate. The revenue levied penalties under …

The respondents, manufacturers of coke, were assessed for tax under the Bihar Finance Act, 1981 and the Deputy Commissioner issued revised assessment orders. After a change in the Deputy Commissioner, the new officer highlighted irregularities and informed the Joint Commissioner, who then exercised suo motu revision po…

The appellant, Triveni Glass Ltd., manufactured tinted glass sheets using a process and raw materials different from plain sheet glass. The revenue assessed tax at 15% on these sheets under Entry IV of Notification No.5784, treating them as "all goods and wares made of glass" and excluded them from the 10% residuary ra…

The Supreme Court examined whether State entry‑tax statutes could levy tax on goods imported from abroad once they entered a local area for consumption, use or sale. It held that the import of goods ends when they cross India's customs frontier and are released for home consumption, after which the State has full compe…

The Supreme Court examined whether sales‑tax exemption/deferment granted to cement manufacturers under the Madhya Pradesh Commercial Tax Act, 1994, would continue to apply after the bifurcation of the erstwhile State of Madhya Pradesh into the reorganised State of Madhya Pradesh and the new State of Chhattisgarh. The C…

The appellants purchased goods from dealers who were exempt from sales tax under the Kerala General Sales Tax Act, 1963 and the Tamil Nadu General Sales Tax Act, 1959, and challenged the levy of purchase tax under s.5A of the Kerala Act and s.7A of the Tamil Nadu Act. The questions were whether such purchases constitut…

M/s Aristo Printers Pvt. Ltd. prints lottery tickets for its customers and procures its own ink and processing chemicals. The Uttar Pradesh Trade Tax Officer levied tax under Section 3F(1)(b) of the Uttar Pradesh Trade Tax Act, 1948 on the value of the ink and chemicals, arguing that they were transferred to the custom…

India Meters Ltd., a dealer in electric meters, collected freight and insurance charges separately from its customers but omitted them from its declared turnover. The assessing authority treated 50% of these charges as part of the sale price and levied sales tax. The dealer appealed, arguing that under Rule 6(c) of the…

United Riceland Ltd., a dealer engaged in purchasing and dehusking paddy for export, was assessed purchase tax for the assessment year 1990-91 under the Haryana General Sales Tax Act, 1973. The dealer challenged the assessment, arguing that the exemption under Section 9(1)(b) should remain effective until the amendment…

The Assistant Commissioner (CT) LTU Kakinada appealed against a High Court order that had quashed an assessment under the Andhra Pradesh Value Added Tax Act, 2005 because the statutory appeal was filed after the 60‑day limitation period. The High Court had allowed the writ petition under Article 226, holding that the s…

The appellant, Commissioner of Trade Tax, Uttar Pradesh, challenged the respondent M/s Kartos International's claim that its scientific and biological equipment—such as biosafety cabinets, laminar flow cabinets, fume hoods, and clean room garments—were exempt from trade tax under Notification No. 1166 dated 10‑April‑20…

M/s Durga Projects Inc, a civil works contractor registered under the Karnataka Value Added Tax (KVAT) Act, 2003 and the Central Sales Tax Act, sought clarification from the Authority for Advance Clarification and Ruling on the tax rate applicable to works contracts before 1 April 2006. The AAR held that the rate shoul…

The Commissioner of Delhi Value Added Tax appealed against the Delhi High Court's order that exempted M/s ABB Ltd. from VAT on sales made to the Delhi Metro Rail Corporation (DMRC) under Sections 7(a) and (c) of the Delhi Value Added Tax Act, 2004. The issue was whether the import of goods and their inter‑state movemen…

The Supreme Court examined whether pan masala and gutkha, products containing betel nut and sometimes tobacco, could be taxed under various state sales‑tax statutes despite being listed as exempt under the Central Sales Tax Act, 1956. The Court analysed the classification of these products under the Central Excise Tari…

The appellant, M/s Hyderabad Engineering Industries, claimed exemption from Central Sales Tax on goods moved from its Hyderabad factory to its out‑of‑state godowns, arguing that the transfers were merely stock movements between branches and not inter‑State sales. The State of Andhra Pradesh contended that the movement …

Patel Brothers, a registered dealer, faced reassessment orders after providing false exemption claims and subsequently filed revision petitions under Section 81 of the Assam Value Added Tax Act, 2003, more than 335 days after the prescribed 60‑day limit. The petitions sought condonation of delay under Section 5 of the …

The Calcutta Club, a Section 25 company operating as a members' club, was served with a notice for non‑payment of sales tax on food and drinks supplied to its permanent members. The Club argued that, under the doctrine of mutuality, no sale occurred because the supplier and the buyer were the same persons, a view uphel…

Lloyd Electric & Engineering Ltd. claimed a 1% concessional Central Sales Tax (CST) rate under Himachal Pradesh's 2004 Industrial Policy, which was originally applicable up to 31‑03‑2009. The Council of Ministers decided to extend this concession to 31‑03‑2013 or until CST is phased out, and the Department of Industrie…

M/s Ravi Prakash Refineries (P) Ltd. sold Sunflower De‑oiled Cake (SF DOC) in inter‑State trade and claimed a reduced central sales tax rate of 2% by producing Form C under Notification No. FD 119 CSL 2002(2). The assessing officer initially accepted the claim, but a later officer reopened the assessment, asserting tha…

M/s Hotel Ashoka, a dealer under the Karnataka Value Added Tax Act, 2003 and the Central Sales Tax Act, 1956, sold goods at its duty‑free shop in Bengaluru International Airport before the goods crossed the customs frontiers of India. The Assistant Commissioner of Commercial Taxes assessed Rs. 4,20,70,900 as sales tax,…

Hindustan Lever Ltd., a tea manufacturer, claimed exemption from entry tax on packing materials used for tea under a 1993 notification and a reduced rate under a 1998 notification. The issue was whether packing material could be classified as "raw materials, component parts or inputs" within Entry 80 of Schedule I of t…

The respondent, FEMC Pratibha Joint Venture, claimed refunds of excess VAT credits for the 4th quarter of 2015‑16 and the 1st quarter of 2017‑18, filing revised returns in 2017 and 2019. The Commissioner of Trade and Taxes failed to refund the amounts and, in 2022, issued an adjustment order that set off the pending re…