S. Muralidhar, J.

1. The challenge in this writ petition by Samsung India Electronics Private Limited is to the demand notices of default assessment of tax and interest dated 31st March 2014 under Section 32 of the Delhi Value Added Tax Act, 2004 (‘DVAT Act’) and the penalty notice of the same date under Section 33 of the DVAT Act issued by the Value Added Tax Officer (‘VATO’).

Background facts

2. The facts leading to the filing of the present petition are that the Petitioner is engaged in the sale of electronic goods, home appliances, consumer durables and information technology products etc. It is a registered dealer under the DVAT Act and has been paying value added tax as well as filing return on monthly basis under the DVAT Act and corresponding Delhi Value Added Tax Rules, 2005 (‘DVAT Rules’).

3. Inter alia the Petitioner sells TFT/LCD/LED monitors. Under Section 4(1)(b) of the DVAT Act in respect of the goods specified in the III Schedule, 5% tax is leviable on the taxable turnover of a dealer. Entry 41 of the Third Schedule covers IT products including computers, telephones and parts thereof, cellular phones and accessories, etc. Entry 41A deals with the IT products and covers IT products as described in column 2 as covered under the headings or sub-headings mentioned in column 3 of the Central Excise Tariff Act, 1985 (‘CET Act’).

4. In the table given below Entry 41A there is an Item at Sl. No. 3 which covers a large range of automatic data processing machines. Specific to the case at hand, it includes “Graphic printer, Plotter, Laser jet printer, key board, Monitor, storage units, floppy disc drive etc.” Column 3 gives the central excise tariff heading as 8471. Notes (2) and (3) read as under:

Note - (2). Where any commodities are described against any heading or, as the case may be, sub-heading, and the description in this entry and in entry number 84 is different in any manner from the corresponding description in the Central Excise Tariff Act, 1985, then, only those commodities described in this entry and in the entry number 84 will be covered by the scope of this notification and other commodities though covered by the corresponding description in the Central Excise Tariff will not be covered by the scope of this notification.

Note-(3). Subject to Note (2), for the purpose of any entry contained in this notification, where the description against any heading or, as the case may be, sub-heading, matches fully with the corresponding description in the Central Excise Tariff, then all the commodities covered for the purposes of the said tariff under that heading or sub-heading will be covered by the scope of this notification.”

5. If an entry does not fall under any of the Schedules, then in terms of the Section 4(1)(d) of the DVAT Act, tax is payable at the rate of 12.5%.

Determination under Section 84of the DVAT Act

6. Another company dealing with electronic products, i.e., NEC India Private Limited (‘NEC’) filed, on 8th July 2008, an application under Section 84 of the DVAT Act for determination of the following question:

“Whether LCD Monitors, LCD Displays/Plasma Displays are exempt from tax as being meant for educational purposes like books, periodicals and journals including maps, charts and globes which are covered by Entry No.5 of the First Schedule to the Delhi Value Added Tax Act, 2004 and are exempt from tax or the same are covered by Entry No. 41 of the Third Schedule to Delhi Value Added Tax Act, 2004 and are taxable @ 4%?”

7. The case of NEC India was that LCD displays/Plasma displays are an integral part of a computer and cannot work unless they are attached to a computer and, therefore, were classifiable under Entry 41 of the Third Schedule. The case of the Department of Trade & Taxes (‘DT&T’) on the other hand was that even though there was Serial No. 18 which covered “LCD displays, LED panels and