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2020 (3) TMI 1317 - KERALA HIGH COURTInterpretation of statute - Sub Entry 27 of Entry 36 of the IIIrd Schedule - Classification of goods - Ayurvedic Baby Soap - Ayurvedic Tooth Paste - Ayurvedic Mouth Wash - Baby gift pack and - Ayurvedic Baby Powder - eligibility for concessional rate of tax in terms of the newly introduced Clause 27 under Entry No. 36 of the IIIrd Schedule to the KVAT Act, 2003 - HELD THAT:- The 'Authority for Clarification' has found against the assessee on the ground that the products in question do not have therapeutic or prophylactic use and therefore they are not 'medicaments'. It is further stated that Soap, Tooth Paste and Mouth Wash are toilet articles and Baby Powder is more of a toilet article than a cosmetic. In the case of Gift Pack, it is found that the major items in the pack are taxable at 14.5% and that the pack therefore attracts tax at the same rate. Tooth paste and tooth powder - HELD THAT:- Apex Court in SARIN CHEMICAL LABORATORY VERSUS COMMISSIONER OF SALES TAX, UP. [1970 (8) TMI 64 - SUPREME COURT] held that Tooth Paste and Tooth Powder are toilet articles and will not be Cosmetics in common parlance. In the above view of the matter, contention raised by the petitioners with regard to Tooth Paste which is one of the products, for which clarification is sought for has to fail. Baby soap - HELD THAT:- Rule 23 of the Rules of Interpretation specifically excludes Soaps from the purview of Entry 36. In view of the fact that Soaps stand specifically excluded under Rule 23, we are not called upon to decide the question whether Baby Soap is a toilet article in common parlance or not. The clarification given in Annexure-IV order with regard to Soap also is therefore perfectly sustainable. Mouth Wash - Gift Packs - Ayurvedic Baby Powder - HELD THAT:- The issue with regard to the exigibility of tax at concessional rates under Sub Entry 27 of Entry 36 of the IIIrd Schedule with regard to Baby Powder, Baby Gift Pack and Mouth Wash are issues which require a reconsideration and a reasoned order at the hands of the clarificatory authority. The findings contained in Annexure A4 order of clarification with regard to Baby Soap and Tooth Paste as contained in the impugned order - With respect to other products the matter is remanded to the 'Authority for Clarification' for reconsideration and a reasoned order on the exigibility of tax to three other products, i.e., Baby Powder, Mouth Wash and Baby Gift Pack. Appeal allowed by way of remand.
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