Maharashtra VAT Circular 11T :- to Impact of SC Decision (of 2011) in Bansal Wire Industries Case

AIT-2011-182-SC
M/s. Bansal Wire Industries Ltd. & Anr Vs. State of U.P. & Ors

Stainless Steel Wire is not covered under the entry of “tools, alloys and special steels” in entry no. (ix) and, therefore, does not fall under “Iron and Steel” as defined under Section 14(iv) of the Central Sales Tax Act, 1956 have to be upheld. Hence, the said commodity cannot be treated as a declared commodity under Section 14 of the Central Act and provision of Section 15 of the Central Act does not apply.

Now the Goverment of Maharashtra also came up with circular 11T which is enclosed herewith to levy the tax effect W.E.F. 26/4/2011.

Earlier Delhi VAT has already executed Circular in 2011 itself as under

CIRCULAR  No.13 .OF 2011-12

In a case titled M/s Bansal Wire Industries Ltd. and Anr. Vs State of UP and Ors., Hon’ble Supreme Court of India vide its judgment dated 26.04.2011 held that “Stainless Steel Wire” does not fall under the category of ‘tools, alloy and special steels’ in entry No. (ix) and, therefore, does not fall under “Iron and Steel” as defined under section 14(iv) of the Central Sales Tax Act.

Also, in the case of M/s Sharma Wire Industries, Commissioner, Value Added Tax, vide Order No. 41/CDVAT/2005 dated 20.10.2005 has determined that Steel Wire Ropes, Stainless Steel Ropes, Copper Wire Ropes and Copper Stay Wires are all taxable @ 12.5% as unscheduled goods u/s 4(1)(e) of the DVAT Act, 2004.

In the above context, it is hereby clarified that while determining taxability of such goods, the ratios of above referred judgment of Hon’ble Supreme Court of India and above quoted determination order shall be applicable.

This issues with the approval of the Commissioner, VAT.

G. C. Lohani)

VATO (Policy