The Supreme Court dismissed Uttar Pradesh’s attempt to levy a 21% state VAT on natural gas transported from Andhra Pradesh to Uttar Pradesh, ruling the transaction is an interstate sale governed by the Central Sales Tax Act. The decision upheld a 2012 Allahabad High Court judgment that quashed UP’s assessment orders against Reliance Industries, Tata Chemicals and IFFCO. The ruling confirms that gas transported through common pipelines remains an interstate sale even when co‑mingled.
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Key Takeaways
The ruling states that such gas is an interstate sale under the Central Sales Tax Act, so state VAT does not apply.
The Central Sales Tax Act governs the sale, as the Supreme Court confirmed it is an interstate sale.
The contested state VAT rate was 21%.
Reliance Industries, Tata Chemicals and IFFCO were the companies affected by the assessment orders.
Primary source
Read the full article at Economic TimesThis summary was published on VATfaqs.com on 18 May 2026. It relates to VAT developments in India. The original source is Economic Times.
