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2017 (12) TMI 1013 - HC - VAT and Sales TaxJurisdiction - interpretation of statute - Section 48-A of the TNVAT Act - case of petitioners is that, under Section 48 -A of the TNVAT Act, the first respondent has no power to interpret Entry in the schedules to the Act, and is entitled only to clarify regarding the rate of tax - Held that: - when an application is made by the dealer, requesting for clarification as to the rate of tax on the commodity dealt with by him, essentially, the first respondent has to examine what is the type of commodity, under which, Entry it would fall and then, proceed to determine the rate of tax of that particular commodity. Therefore, while issuing such clarification, the first respondent is empowered to clarify any point, concerning the rate of tax, and therefore, to state that the first respondent has no power to interpret the Entry in the schedule to the Act, is not tenable. Classification of goods - yarn - case of petitioners is that all types of yarn, that are packed in hank form are taxable at 5% and the statute does not make a further distinction regarding what is the type of hank yarn, that should be exempted but the exemption shall enure to hank yarn of all kind - Held that: - the Hank Yarn Packing Notification issued by the Government of India pertains to yarn made out of the cotton. Hence, the term ''hank yarn'' used in the Budget Speech shall be referable to only cotton yarn packed in hank form. The intent of the Central Government as well as the State Government is to protect the handloom Industries. Both the Central and the State Governments were concerned about the plight of the poor hand loom weavers, and their family members, and they need to be provided with adequate quantity of yarn in hank form, so that, they can earn their livelihood by operating the hand loom - to state that Entry 44 of Part-B of the fourth schedule to the TNVAT Act should be interpreted to mean any type of yarn, packed in hank form, is a plea, which would be unacceptable, and not the intention of the Government to grant exemption. Admittedly, the Government inserted hank yarn in Sl.No.44 only during 2006-07, and as rightly pointed out by the learned Special Government Pleader, this being an exemption clause, strict interpretation has to be given to such exemption clause, and there is no room for any liberal interpretation with regard to such exemption. What is required to be taken note of, is the plain terms, based on which, exemption was conceived and granted, and if this is examined, it is clear that the exemption was to reach particular section of weavers, viz. Handloom weavers. Likewise, the Hank Yarn Packing Notification issued by the Ministry of Textiles, Government of India, 17.04.2003, is to protect the handloom weavers, and under the said statutory notification, the term 'Yarn' has been defined only as cotton yarn. To interpret that Entry 44 to mean to include all types of yarn packed in hank form is incorrect way of interpreting the exemption provision. Petition dismissed - decided against petitioner.
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