Norandal USA, Inc. v. Ruth E. Johnson, Commissioner of Revenue for the State of Tennessee

This is a sales tax case. The plaintiff owns an aluminum sheet and foil manufacturing plant. Located in the plant are two multi-ton roll grinders. In 1987, the defendant commissioner of revenue took the position that the roll grinders and roll grinder supplies were exempt from sales tax, because the roll grinders constituted "industrial machinery," which were exempt. In 1995, however, the department of revenue conducted an audit of the plaintiff and changed its position, concluding that the roll grinders were "equipment used for maintenance," which is an exception to the industrial machinery exemption. Accordingly, the plaintiff was assessed for sales tax on roll grinder supplies purchased between 1995 and 1998. The plaintiff paid the assessment under protest and filed the instant lawsuit, seeking to recover the sales tax paid on roll grinder supplies for the audit period. The trial court upheld the decision of the department of revenue, concluding that the roll grinders were "equipment used for maintenance." From that order, the plaintiff now appeals. We affirm, finding that the roll grinders fit within the "equipment used for maintenance" exception and that, consequently, roll grinder supplies are subject to sales tax.