INDIA : SAMSUNG ORDERED TO LOWER TAX RATE FOR CARTRIDGES

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INDIA : SAMSUNG ORDERED TO LOWER TAX RATE FOR CARTRIDGES

 user 2009-11-10 at 10:41:05 am Views: 37
  • #22897

    http://www.ciol.com/Channel-News/News-Reports/Samsung-printers-cartridges-get-stay-order-on-12.5-p.c-VAT/191009126485/0/
    INDIA : SAMSUNG ORDERED TO LOWER TAX RATE FOR CARTRIDGES
    The company’s printer division obtained the order for all its distributors across Tamil Nadu
    CHENNAI, INDIA: Earlier this month, the High Court of Madras issued an interim injunction to Samsung India Electronics and its distributors in Tamil Nadu against levying value-added tax (VAT) higher than four percent on printer toners and cartridges.In its plea seeking interim injunction, Samsung (Printer Division) had included its distributors—Carewel Systems (Vellore), Vijex & Company (Chennai), Sukkra Traders (Puducherry), Micro Automation Info India (Tirupur), Vijex Office Product (Coimbatore), Vinay Agencies (Erode), Uttam Marketing (Chennai) and Micro Machines (Salem) as petitioners.

    The judgment of Honorable Justice V Ramasubramanian restrains the appropriate authorities from recovering tax with respect to sale of printer toners/cartridges at a rate higher than four percent tax.The order is applicable to all the petitioners. All the partners The DQ Week contacted hailed Samsung’s support in this issue. R Krishnamoorthi, MD of Tiruppur-based Micro Automation Info India enthused, “Samsung stood by its words, and we are very thankful to the company for its committed support.”On a similar note, Rajesh Kumar, Proprietor of Erode-based Vinay Agencies said, “Samsung always supports its partners and will not let them down. We will be united and face the VAT issue together.” Saravanan, CEO, Carewel Systems, Vellore, expressing relief shared that they were happy and content to be part of Samsung family.

    The Tamil Nadu VAT Act—Schedule 1, Part B states that toners and cartridges are excluded from the four percent tax. Citing the act, the appropriate authorities claim that the product thus attracts 12.5 percent tax. However, all the partners across Tamil Nadu have been levying four percent tax on toners and cartridges. The department has been issuing notices to several partners across Tamil Nadu to pay 12.5 percent of VAT on all those ink cartridges and toners sold from 2007 till date.In this regard, Canon had obtained an interim injunction in Madras High Court in February 2008. Earlier, Manufacturers Association for IT (MAIT) had been updated by the state government of Tamil Nadu in 2007, that the ink cartridges and toners attract a VAT of 12.5 percent. But, this was allegedly not communicated to the channel partners. It was viewed as a serious case of violation by Confed-ITA.