The High Court · 2025

M/S.FUJITSU lclM LIMITED, [Now known as Zensar Technologies Limited] rep by its Drrector Mr.P K.Choksey O/o.Zensar Knowlege Part, Plot # 4, MlDDC.. Kharadi, Off Nagar Road, Pune - 411 014. PETITIONER AND THE SALES TAX APPELLATE TRIBUNAL, rep by its State Regpresentative before the STAT O/o.Nampally, Hyderabad. RESPONDENT Counsel for the Petitioner : SRl.S. VIJAY ADITHYA SRI. KARTHIK RAMANA PUTTAMREDDY Counsel for the Respondents Special Govt Pleader for State Tax The Court made the following: COMMON ORDER I PSK,J & SC&J Trevc-.48&23O-2(x)9 THE HONOURABLE SRI JUSTICE P.SAM KOSHY AND THE HONOURABLE SRI JUSTICE SUDDALA CHALAPATHI RAO Tax Revision Case No.48 of 2OO9 Tax Revision Case No.23O of 2OO9 COMMON ORDER: (per Hon'bte Sri Justice P.SAM KOSITY) Since the issue for consideration in these two Tax Revision Cases is one and the same and the parties therein are also sarne, we proceed to decide the Tax Revision Cases by way of this Common Order.

2. Tax Revision Case No.48 of 2009 and Tax Revision Case No.230 of 2009 are filed by the petitioner under Section 22(ll of the Andhra Pradesh General Sales Tax Act, 1957 praying the Court to revise the Common Order dated 06.10.2008 in T.A.No.1118 of 2OO2 and T.A.No. 11 19 of 2002 passed by the Sales Tax Appeliate Tribunal (for short, 'the impugned common order').

3. Heard Mr.S. VUay Adithya, iearned counsel representing Mr.P. Karthik Ramana, learned counsei for the petitioners; and Mr.Sai Akarsha, learned Assistant Government Pleader representing learned Special Standing Counsel for the State Tax, for the respondents.

4. For convenience, the facts in Tax Revision Case are discussed hereunder. 'n ', t tV P{IK,J & SCR,J Trevc 48&230 2OO9

5. The petitioner herein is a registered dea-ler on the rolls of the Commercial Tax Ofhcer, Basheerbagh Circle, and is engaged in the business of leasing computers. In the course of business, the pctitioner lvas assessed to tax for the Assessment Year 1996-97 under the Andhra Pradesh General Sales Tax Act, 1957 and Central Sales Tax Act, 1956 (hereinafter referred to as the 'APGST Act & CST Act'). The respective assessments were finalized by the Commercial Tax Olficer, Basheerbagh vide order dated 21.10.1999 in Assessment No.2BBO/96-97iAPGST. Thereafter, the Deputy Commissioner (Commercial Tax). Abids Division, Hyderabad, i.e., the revisional authoritl , on scrutiny of the above assessment order, found that the assessing authorit-v failecl to lery 1% T\rrnover Tax under Section 5A of the Act; and accordingly, the revisional authority revised the assessment order passed by the assessing authority and levied tax @ la/o on the lease rentable turnover oi Rs.74,19,575/- under Section 5-A of the APGST Act.

6. Thc whole issue involved in these two Tax Revision Cases is pertaining to leq, of tax on lease rentable turnover.

7. [,earned counsel for the petitioner contended that under Sections 5-A of the APGST Act, the turnover tax cannot be levied on rentals. Therefore, the petitioner objected to levying of tax on the turnover assessed by the revisional authorit5r under Section 5-A, of the Act / PSK,J & SCR"J Trevc 48&230 2OO9 particularly in the light of provisions of Section 5-A. He further contended that once the turnover tax was paid under Section 5-A, it carnot be levied on the turnover assessable under Section 5-E of the Act; therefore, the contention of petitioner was accepted by the assessing officer and the proposal to ler.y tax under Section 5-E stood dropped. However, the revisional authority, on scrutiny, issued a I revisional show-cause notice to the assessee calling for explanation as to why the turnover tax should not be levied in terms of Section 5-E of the Act.

8. Learned counsel for the petitioner further contended that the revisional authority in the course of deciding the matter reached to the conclusion that Section 5-A of the Act is a general provision relatable to various turnovers, whereas Section 5-E was an independent and special charging section in respect of amount reejliz*d against any right to use goods which, in the instant case, was the lease transactions. He further contended that the revisional authority went on to decide the case by holding that where turnover tax under Section 5-A is leviable there is full scope for levy of tax under Section 5-E of the Act. In the same way, where tax is levied under Section 5-E, there is simultaneously full scope for levy of tax under Section 5-A of the Act. He further contended that the revisional authority went on to hold that both Sections can have full play in their PfIKJ & SCR,J Trevc 48&230 2OO9 demarked fields ernd there would be no clash among the two provisions and accordingly dropping of lely of tax under Section 5-E of the Act bv the assessing authority was revised by the revisional authoritl, holding that the assessee would be entitled to pay tax also under Section 5-E of the Act in addition to the tax that was paid by the assessee under Section 5 A of the Act. Aggrieved thereby, the petitioner challenged the order passed by the revisional authority before the Tribunal, and the Tribunal after hearing both sides, dismissed the appeai preferred by the petitioner by affirming the order passed by the revisional authority.

9. Assailing the same, the instant Tax Revision Case has been Iiled by the petitioner.

10. Learned counsel for the petitioner contended that the Tribunal had wrongly affirmed the order passed by the revisional authoritSz by dismissing the appeal preferred by the petitioner holding that the turnover tax levied under Section 5-A of the Act is still a leviable transaction under Sections 5-E and 5-F of the Act. According to him, all the agreements of lease in question were those which were executed prior to 01.08. 1996 and thus for the agreements entered into prior to 01.08.1996, the tax ought not to have been levied thereon under Section 5-E of the Act. I I PSK,J & SCR,J Ttevc 48&23O_2OO9 ,' LL. In support of his contentions, learned counsel for the petitioner relied on the following decisions, viz., TVentieth Century Finance Corporation vs. State of Maharashtra t and Coromandal Finance Co. Ltd. vs. Commissioner of Commercial Taxes2 L2. Having heard the contenlions put forth on either side and on a perusal of the record, it would be relevant at this juncture to take note of certain provisions of law under the APGST Act.

13. Section 2(rl of APGST Act defines the term 'tota-l turnover', as under, viz., "2(r) 'Total Tvntotrcr" means the oggregate tumouer in all goods of a dealer at all places of business in tlrc Stctte, uhether or not the uhote or anA portion of such turnouer i.s liable to tax, (including the tumouer of purchases or sales in the course in inter-State trade or commerce or in the course of export of the good.s out of the territory of India or in the course of import of tLe goods into the territory of India. " L4. Similarly, Section 2(s) of the APGST Act dehnes the term 'turnover' as under, viz., "2(s) Tuntouer meatls - (t) Ttrc totat amount set out in tlrc bilt of sale excluding the anaunt collected touards tlrc tax or the tox due under the Acl uthicheuer i.s less; t [2o0ol 1 19 s.T.c. 182 , 2001 (3) ALT 238 - P{iK,J & SCR J Trevc 4E&23O 2O$) (ii) (iil The total amount of ansideration for the sale or purchase of goods excluding the tox due untier the Act a.s may be detennined bg the a.ssessing authoitg, if the bill of sale does not set out correctly the amaunt for uhich the goods are sold; or If there is no bill of sale, the total amount charged a.s tle consideration for the sale or purchnse of good.s bg a dealer either directly or thnugh another, on his outa account or on occount of others, whether such consideration be cash, deferred pagment or any other thing of ualue and shall include, - (a) The ualue of ang goods a.s d.etermined bg tLrc assessing outhoitA; (i)to haue been used or supplied by the d.ealer in the aturse of exeattion of the u-torks controct; (ii)to haue been deliuered bg the deoler on hire purcltase or anA otkler system of pagment bg instolments; (iii) to houe been supplied or dtstributed bg a soctety including a a operatiue societg, ctub, finn or association to its members, uhere the cost of such goods A not separotely sown or indicated bg the dealer and Luhere the cost of such goods is separatelg shou-n or indicated bg tle dealer, the cost of such goods as shorzn or indicated; (b) Any other sum charged bg the dealer for angthing done in respect of goods sold af the time of, or before, the deliuery of the goods; (c) Any other sum charged bg the dealer, uhateuer be the desciption, name or object thereof; and PSK,J & SCR,J Ttevc 48&23O,2OO9 (d) TLe aggregate or amounts charged under Section 5-C or realizoble under Sedion 5-8.

15. Further, Section 5-A of the Act was inserted vide Act 27 of 1996, w.e.f. 01.O8. 1996, which for ready reference is extracted hereunder, wz., '5-A. I*ng oJ tax on tumoter - (1) Notutith.standing angthing contained. in this Act, tox shnll be Lewed at the rate of one pai-se on euery tupee of turnouer of a dealer, other tLnn the dealers maintained in sub section (1-A) uhose total turnouer in a gear exceeds rupees ten lakh-s: Prouided that the tax shall not be leuied under thi.s section on that part of the hmouer of any dealer on tuhich tLe dealer i-s liable to paA tax at the point of leug specifted in the First Schedule, Second Schcdulc, Fifth Schedule ond Seuenth Schedule to the Act: Provided further that no tox under this section shall be payable on thnt part of turnouer u-thich relates to; (i)sale or purchase of goods specified in Third Schedule; (ii)sale or purchase of gor-tds specifted in Fourth Schedule; (iii)sale or purchase of goods specified in Sixth Sched.ule; (iu)sale or purcLnse of goods in th.e course of inter-State trade or commerce; (u) sale or purchase of goods in the course ofexport out of the territory of India or sale or purchase in the course of import into the territory of Indin; (ui) sale or purclnse of goods exempt from tax genero)lg under slb- section ( 1 ) of section 9 of the said Act; (uii) all amounts allected by uag of tox under the prouision-s of the Central Sales Tax Act, 1956.' \ PSiK,J & Trevc 48&230 2OO9

16. Before insertion of Section 5-A, quoted above, Section 5-E of the APGST Act was substituted vide Act 22 of 1995, w.e.f. 01.O4.1995, which for ready reference is reproduced hereunder, \liz., 'S-E.To-x. on the d.nount tealised in respect of ang dght to use goods: Notuith^stonding anything contained in thlb Act; (a) Euery deo,ler wla transfers the right to use ang goods for ang purpose, whatsoeuer, u.thether or not for a specifred peiod, to ang lessee or licencee for cosh, deferred paument or other ualuable consideration, in the course of his buslness shol| on the total amount realbed or realisable bg him by uag of pagment in co-sh or oth.enL-tise on such transfer or transfers of the ight to use such goods from tte Iessee or Licencee. [pag a tux at the rate of eighl pai.se on euery rupeelof the aggregate of such amount realised or realisable by him duing the gear; (b) the trorsfer of nght to use onA such goods entered into by ang dealer, shall be deemed to haue taken place in this State wheneuer the goods are used uithin the State, irrespectiue of the place u.tlere thE agreement whether uritten or oral for such transfer of rigru is made. Prouided that no such tax shall be leuted of the totol turnouer of the dealer including such aggregate is less than Rs. trao /akhs.

17. Now, when we read the aforesaid provisions of law, i.e., 'total turnover" and "turnover", both have been separately defined under the above respective provisions. Then the above two provisions of law were subsequently inserted, i.e., Section 5-A which deals with the levy of tax on turnover and, Section 5-E which deals with the tax to be collected on the amount realized in respect of any right to use goods. P!iK,J & SCR J Trevc 48&23O,2OO9 Both these provisions takes us to the only conclusion that each of the provision is operational in its own sphere independently and that, under no circumstances carr it be said that by the introduction of one the existence of the other had got lost.

18. Another aspect u,hich needs to be considered is that Section 5-E of the Act operates only in a limited a-rea, i.e., in respect of the amounts collected against the right to use of goods. Whereas, Section 5-A is a general one which will cover the whole of turnover of the business entity. Thus, in the opinion of this Bench, the Tribunal has not committed any error in the course of dismissing the appeal preferred by the petitioner particularly when the case was decided by the Tribunal foliowing the two decisions of the then recent past, in the case of Nava;ruga Engineering Co., Ltd., Visakhapatnam Vs. State of Andhra Pradesh 3 and Bombay Dyeing and Marufacturing Company vs. State of Andhra Pradesha.

19. For all the aforesaid reasons, this Bench is of the considered opinion that no strong case has been made out by the iearned counsel for the petitioner ca,lling for interference to the impugrred Common Order dated 06.10.2008 in T.A.No.1118 of 2OO2 and T.A.No.1i19 of 2OO2 passed by the Sales Tax Appellate Tribunal. Therefore, the Tax 3 (2007) 4s APSTJ 2 4 (1999) 28 APSTJ 324 IG PSK,J & Tr€vc 48&230 2oo9 Revision Case No.48 of 20O9 fails, and the same is accordingly dismissed. As a consequence, Tax Revision Case No-23O of 2OO9 also stands dismissed on similar lines. No costs.

20. As a sequel, miscellaneous petitions pending if any in these Tax Revision Cases, shall stand closed SD/.K.SRINIVASA RAO JOINT REGISTRAR /ITRUE COPY' SECT FFICER To,

1. THE SALES TAX APPELLATE TRIBUNAL, Nampally, Hyderabad. 2. The Dy. Commissioner (CT), Abids Division, Hyderabad 3. The Commercial Tax Officer, Basheerbagh Circle, Hyde/abad. 4. One CC to SRl. KARTHIK RAMANA PUTTAIVIREDDY Advocate [OPUC] 5. Two CCs to SRl. Special Govt Pleader for State Tax, High Court for the State of Telangana, Hyderabad. [OPUC]

6. Two CD Copies ASR]? SL lN HIGH COURT DATED:2811112025 I ! ORDER TREVC.No.48 & 230 OF 2009 t THE S c o t + 0 5 r[8 20i6 t DISMISSIN(; THE TREVS ,f, \>