Summary
The Supreme Court held that wire ropes used in mobile cranes were essential crane parts taxable at 4% under Entry 155 of Schedule IV of the Rajasthan VAT Act at the relevant time, rather than at 12.5% under the residuary entry. Technical literature established that a mobile crane could not function without them. The decision expressly addressed wire ropes in the context of their use in mobile cranes.
Issues
- Whether mobile-crane wire ropes fell within the parts entry or the residuary VAT entry.
Provisions considered
- Schedule IV, Entry 155; Schedule V, residuary entry, Rajasthan Value Added Tax Act, 2003The specific 4% entry covering mobile cranes and their parts applied instead of the 12.5% residuary entry, under the entries applicable to the assessment. (¶¶ 24–26, 28–33)
Held
- The parts wording was inserted in Entry 155 with effect from 9 May 2006. A thing is a part of another when the latter is incomplete or cannot function without it. (¶ 24–27)
- The technical literature and specifications showed wire ropes were essential to making mobile cranes operational. They therefore fell within the specific entry for crane parts. The ruling was confined to wire ropes used in mobile cranes. (¶ 28–33)
- The principal State appeal and the connected appeals failed on this classification. (¶¶ 34, Connected appeals: 2–3)
Result
State appeals dismissed; classification of mobile-crane wire ropes at the relevant 4% rate upheld.