Home Case Index All Cases VAT and Sales Tax VAT and Sales Tax + HC VAT and Sales Tax - 2012 (12) TMI HC This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2012 (12) TMI 908 - HC - VAT and Sales TaxRevision petition under Section 72 - Tripura Value Added Tax Act,2004 – Tripura VAT Rules 2005 - Search & seizure – Classification - Twin test for determining the classification - Mis-declaration of goods as – Entry No.183 under Schedule II(b) - Section 3 of Drugs and Cosmetics Act 1940 - Entry No. 67(i) of Schedule 11(a) ‘H.L. medicine’ attracting tax @ 5% but on physical verification during the search was found by the seizing authority that the item is ‘Appetite Tonic’ which is taxable @ 13.5% Held that:- The petitioner declared the product as H.L. medicine in the statutory declaration as was required to be furnished at the time of crossing the barrier. Unless contrary to that is established by the revenue in accordance with the decisions of the Apex Court as referred, it has to be treated as properly declared. Therefore, the order dated 25.03.2011 as passed in Seizure Case No.1549/CRB/2010-11 cannot be sustained in law. The revisional authority, the Commissioner of Taxes, without any test, affirmed the order of the Officer In-charge. The Revenue thus failed to discharge their burden to properly classify the product. As such, the order dated 21.10.2011 is liable to be set aside and accordingly it is set aside. Since there is a controversy as regards the classification of the product or as regards the decision arrived at on the basis of the common parlance test, the Revenue is under obligation to adopt the twin test if the assessee approached for re-determination of the classification. But such approach was the basis of the revision as filed under Section 70 of the TVAT Act, 2004. The Revenue has utterly failed to discharge the said obligation. In view of this, the Commissioner of Taxes is directed to adopt the twin test for determining the classification, meaning thereby the common parlance test such as the functional utility and pre-dominance of the primary uses of the commodity apart from taking into account other understanding in common parlance such as to consider the product literature and label etc. and thereafter to determine the composition and character of the product on resorting to the scientific test. The Commissioner of Taxes shall also be at liberty to take aid from the Deputy Drug Controller, Govt. of Tripura for determining the composition of the product to classify the product in controversy having the brand name of ‘Betonin AST Tonic’ manufactured by M/s Sangfroid Industries Ltd., IDA, Kothur, Andhra Pradesh. The said exercise of determining the classification of the said product shall be completed within a period of 6(six) weeks from the day of receipt of this judgment and order. Prior to determination of classification of the said product, VAT more than 5% shall not be charged on the petitioner against the said import of the product. Order of Seizure set aside and case remand back to Commissioner for classification
|