The Hindu : Karnataka News : Rotem commercial tax case hearing adjourned

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Friday, Sep 14, 2007
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Karnataka

Karnataka

Rotem commercial tax case hearing adjourned

Staff Reporter

Tax has already been paid in Delhi, says firm

BANGALORE: The Karnataka High Court on Wednesday adjourned further hearing on appeals by Rotem against a single judge order directing the company to pay Rs. 25 crore tax to the Commercial Tax Department.

Appeal

Rotem, in its appeal, said it is part of a consortium comprising Mitsubishi Corporation and MLECO, formed for implementing the Delhi metro project. It had initially petitioned the court against the demand of the department seeking payment of Rs. 35 crore as sales tax.

Sub-contract

Rotem had bagged the contract for manufacturing “cab cars” for the metro. It had sub-contracted the manufacture of “cab cars” to Bangalore-based Bharat Earth Movers Limited (BEML).

Tax authorities in the State issued a notice to Rotem asking it to pay Rs. 35 crore as sales tax. A single judge had on August 9, 2007, directed the company to pay Rs. 25 crore.

Not liable

In its appeal, Rotem contended that it was not liable to pay tax in Karnataka as there was no sale as per the Central Sales Tax (CST) between the State and Delhi. Moreover, tax had already been paid in Delhi and the firm could not be subjected to double taxation.

A Division Bench comprising Justice S.R. Bannurmath and Justice A.N. Venugopal Gowda adjourned further hearing on the case.

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