Scope of items to be covered under “Hardware goods”

One of the items specified under notification no. 25 dt. 31-03-2006 for downloading Form-49 is “Hardware Goods”. The term hardware can cover variety of goods. Due to this, registered dealers sometimes fall in dilemma that whether or not there product will be covered under Hardware Goods.

In such situation, decision of Allahabad High Court in case of Aftab Husain Imdad Husain can provide little guidance. [(1970) 25 STC 471 (All.)]

On going through the said decision, it is clear that every article that is made of iron or other base metal cannot be regarded as an article of hardware. The Honourable High Court has, after considering literature in some of the then popular trade journals and catalogues of hardware items, like “British Empire Trade Index” and the “Bombay Market” has clarified that hardware items shall include the following:

  1. Mill-stores like small tools and spare parts of machinery.
  2. Small items of base metals, particularly- building materials like nuts, bolts, hinges, rivets, laches, curtain railings, window grills etc.

Relevant portion of the said decision is shared below for reference of our clients and professional colleagues.

Readers are requested to note that above decision does not give an exhaustive or complete list of all goods that are to be covered or not to be covered under hardware items but it may provide guidance in case of litigation or problems at check-post.


Clarification on rate of tax of various items of Schedule II (292 dt 31/07/2006)

We receive numerous queries regarding rate of tax on various items on which Schedule II is not very clear.

Hon’ble CCT had issued circular number 292 dt. 31/07/2006 to clarify rate of tax on various items such as – renewable energy devices, tarpaulin, ferro-alloys, ruhafza, components used in manufacture of transformer, Jute items, office stationary, scientific and medical equipments, electrical power capacitors, insulation tape, cut-out, photo and stamp albums, school bags, soap stone, lead oxide, UPS inverter, trade rubber, bi-metal bearing, paper board, brass and copper utensils, non-ferrous metal scrap, khoya and paneer, mini rice mill and allied products, plastic items (namely mugs, spoon, bowl, class, containers etc.) handkerchief, drip irrigation systems, dental equipments, etc.

A copy of said circular is attached below.

Readers are requested to note that rates mentioned in below circular which are 4% and 12.5% were amended from time to time and are presently 5% and 14% respectively.

Clarification on entries of schedule II

Amendment in PT Rates

As per recent amendments, the rates for Professional Tax for Employers as well as dealers of registered under MP VAT Act have been amended which are applicable w.e.f. 01/04/2013. The revised rates are as follows:

Persons in employmentwhose annual salary or wages:(to be deducted by employers)
a) does not exceed Rs.1,50,000 NIL
b) exceeds Rs.1,50,000 but less than Rs.1,80,000 NIL
c) is Rs.1,80,000 and more Rs.2,500 (Rs.208 per month for 11 months and Rs.212 for the twelth month)
For dealers liable to pay tax under MPVAT Act, whose annual gross turnover:
a) does not exceed Rs.10,00,000 NIL
b) exceeds Rs.10,00,000 but less than Rs.50,00,000 Rs.2,000
c) is Rs.50,00,000 and more Rs.2,500

 Note: There is no amendment in respect of company assessees, and such assessees are liable to pay PT of Rs.2,500 annually as per existing provisions irrespective of turnover.

Please note, this post does not contain complete list of PT payable. A person may be covered under any other entry of PT schedule which is not mentioned above.