The division bench of Gujarat High Court held that, Titan’s Nebula Watch is more a Jewellery than a Watch for the purpose of levying Value Added Tax, Which is come under the Entry 13(ii) of Schedule-II to the Gujarat Value Added Tax Act.
The Assessee M/s Titan Industries Limited is manufacturing Electronic Watches, Jewellery Watches (NEBULA brand), at his various factories in India.
The Court noted that, NEBULA Watch is made of 18 Karat of gold. In manufacturing the NEBULA Watch, precious metals /precious stone /diamonds are used. The value of gold or precious stone remains 90% to 95%. Thus, the NEBULA Watch is made of gold and /or silver and /or precious metal and /or precious stones, which are manufactured within the factory of the assessee with precision craftsmanship by the designers and artisans like goldsmith. NEBULA Watches are sold by and large at jewellery shops and they are not sold in normal ordinary watch shops.
The division bench comprising of Justice M.R Shah and Justice B.N Karia observed that, “Though, the jewellery watch is not defined under the Act, however, as per Entry No.13(ii) of Schedule II of the Act, Articles or Jewellery made of gold or silver or both or of other precious metals, shall fall under Entry No.13(ii) of Schedule II of the Act”.
“In the present case, NEBULA Watch, which is predominantly a jewellery, is made of gold, precious metals and /or precious stones /diamonds and is made of 18 Karat gold. Under the circumstances, the same can be said to be an “Article or Jewellery” falling within Entry No.13(ii) of Schedule II of the Act”, the bench also added.
While dismissing the appeal, the division bench also observed that, “there is no error has been committed by the tribunal in holding NEBULA Watch as NEBULA Jewellery Watch falling under Entry 13(ii) of Schedule II of the Act. We are in complete agreement with the view taken by the learned tribunal. We see no reason to interfere with the impugned judgment and order passed by the learned tribunal”.
Read the full text of the Judgment below.
