ORDER OF CLARIFICATION MADE BY SHRI. HARDEEP KUMAR, I.A.S.,

PRINCIPAL SECRETARY, TO GOVERNMENT OF HARYANA,

EXCISE & TAXATION DEPARTMENT,

Under Section 56(3) of the Haryana Value Added Tax Act, 2003

To M/s. Shri Balaji Bricks Company Village Charnia,

Tehsil Kalka, District Panchkula.

M/s. Shri Balaji Bricks Company Village Charnia, Tehsil Kalka, District Panchkula (TIN: 06332507854) (here-in-after referred to as the applicant), has sought clarification u/s 56(3) of the Haryana Value Added Tax Act, 2003 (here-in-after referred to as the Act) on the issue pertaining to calculating the number of Ghoris in a brick kiln having High Draft Kiln technology.

2. As per the statement of facts, the applicant is a brick kiln owner and has installed a High Draft Brick Kiln (HDBK) in Panchkula district. He has opted to pay lump sum tax under rule 47 of the Haryana Value Added Tax Rules, 2003 (here-in-after referred to as the Rules) and presently paying lump sum tax by treating the BKO in "B" category as according to him 27 Ghoris are installed. It is submitted by the applicant that in Brick Kiln the depth of the vessel i.e. distance between the outer and inner wall generally measures 31.5 feet and the Ghoris (columns) are made in the vessel. A brick generally measures 9 inches length and 4.5 inches width. In Low Draft Technology Kiln or in traditional kiln, a Ghori is prepared by laying longer side of one brick horizontally and placing the other bricks in its side and the next layer of bricks is placed on the top of these bricks. And a distance of about 4.5 to 5 inch is maintained between any two such Ghoris (columns). But in a HDBK two bricks of 9" each are kept horizontally in the same line (i.e 9"+ 9") and other two bricks are kept side by side to them while the next layer of the bricks are placed on the top of these bricks. A space of about 4.5" to 5" inch is maintained between two such Ghoris (columns). It is contended by the applicant that by putting two bricks horizontally in a column and then separating the next column with a space of 4.5 inch the number of Ghoris are practically reduced to 17 only and thus they are liable to pay lump sum VAT under category "C" instead of category "B". It is further claimed by the applicant that in the light of the definition of "Ghori" given in the explanation added to the sub rule (1) of Rule 47 of the Rules, one Ghori is of 14" length irrespective of the number of bricks placed in a Ghori. It is his version that the total length of the vessel of the kiln which is 31.5 feet in the case of the applicant, if divided by 14 inch for one Ghori, then only 17 Ghoris can be considered to have been placed in the kiln by the applicant and hence the correct category to pay lump sum tax will be "C" and not "B" under which he is presently paying VAT.

3. The issue has been examined The provision relating to lump sum scheme in respect of brick kiln is contained in Rule 47 of the Rules. Lump sum rates are prescribed keeping in view the number of Ghoris installed in a brick kiln. The greater the number of Ghoris the higher the lump sum tax rate. Further, a Ghori has been defined in an explanation contained in Sub Rule 1 of Rule 47 which is reproduced as follows:-

Explanation: A Ghori is vertical column of brick of width equaling the length of a brick separated from the next vertical column by distance of about 4 inch to 5 inch and number of Ghori is the number of vertical column of bricks capable of being accommodated between the inner and outer wall of the vessel of the brick Kiln over its full length.

4. Now how the bricks are placed in a kiln and Ghoris are prepared is explained through the diagram as below: -

TRADITIONAL OR LOW DRAFT TECHNOLOGY KILN

HIGH DRAFT TECHNOLOGY KILN.

6. Now how to determine the number of Ghoris in a kiln. As claimed by the applicant, the total outer limit or length of the vessel is 31.5 feet which comes to 378 inches. But on physical verification by the office of the Deputy Excise & Taxation Commissioner (ST), Panchkula, it is found that the width of the vessel actually comes to 32.5 feet and not 31.5 feet. Thus it shows that a brick kiln owner may alter the width of the vessel and also the distance to be kept between Ghoris in the vessel. This leads to say that the number of Ghoris actually prepared cannot be derived by simple arithmetic calculation only but a physical look is also necessary. In the case of the applicant, the Ghoris has been claimed of 18" + distance width but the definition of Ghori as contained in the Rules mentions the width of 9"+ distance. Thus the interpretation of the applicant that one Ghori consists of 22 inch is incorrect. Rather placing of two bricks measuring 9 inch each horizontally in a line is nothing but preparing two Ghoris of 9 inch each without giving space. The arrangement of the applicant shows that these are two Ghoris equaling the length of two bricks but the same is clamped in a way to show as one Ghori. Here the distance between two Ghoris mentioned in the Rules is not of much significance being the lump sum rates as contained in the table have been specially linked to the number of Ghoris contained in a brick kiln.

7. In the light of the above, though the applicant claims that only 17 Ghoris or columns of two horizontal bricks are prepared in the vessel but when looked into the definition of a Ghori as per Rule 47(1) and the arrangement of the applicant this figure comes to 34 and not 17 Ghoris. The figure of 27 Ghoris on

which the applicant is presently paying lump sum tax is also incorrect. The applicant is thus liable to pay lump sum amount of VAT under category +A (having more than 33 number of Ghoris).

The matter stands clarified as above.