9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (1) TMI 56 - HC - VAT and Sales TaxLevy of Sales tax - Hajmola candy - taxable as an Ayurvedic medicine under list A of the Orissa Sales Tax Act 1947 or not - HELD THAT - A perusal of the impugned order of the Tribunal reveals that the tribunal primarily relied on the decision of the DABUR INDIA LIMITED AND ANOTHER VERSUS ACCT/CORPORATE DIVISION AND OTHERS 2006 (1) TMI 584 - WEST BENGAL TAXATION TRIBUNAL . In the said decision the WBTT took note of the decision of the Special Bench of the CEGAT New Delhi in DABUR INDIA LTD. VERSUS COLLECTOR OF CENTRAL EXCISE MEERUT 1994 (3) TMI 202 - CEGAT NEW DELHI holding that Hajmola candy does not fall in the entries of drugs and medicines and it is taxable as a confectionery. In the present case as well the assessee had satisfactorily demonstrated that the product in question was an Ayurvedic Medicine for which the assessee possessed a trade licence. The question of law framed by this Court is answered in the affirmative i.e. in favour of the Petitioner Assessee and against the Department by holding that Hajmola Candy is exigible to tax as Ayurvedic Medicine in terms of the List-A of the OST Act - revision disposed off.
Issues:
1. Classification of Hajmola candy for tax purposes under the Orissa Sales Tax Act, 1947. Analysis: Issue 1: Classification of Hajmola candy for tax purposes under the Orissa Sales Tax Act, 1947 The case involved the classification of Hajmola candy under the Orissa Sales Tax Act, 1947. The petitioner, a public limited company engaged in manufacturing and selling various products, including ayurvedic medicines, contested the treatment of Hajmola candy as a confectionery item taxable at 12% sales tax by the Sales Tax Officer (STO). The Assistant Commissioner of Sales Tax (ACST) initially held that Hajmola candy is an Ayurvedic medicine and should be taxed at the prevailing rate under Entry-37 of the list of goods. However, the Orissa Sales Tax Tribunal (Tribunal) overturned this decision, stating that Hajmola candy is not an Ayurvedic medicine and should be taxed as a confectionery item. The Tribunal relied on a decision of the West Bengal Taxation Tribunal (WBTT) and omitted to consider the decision in Panama Chemical Works v. Union of India, which classified similar products as Ayurvedic medicines. Additionally, the CEGAT in Commissioner, Central Excise, Chandigarh-I v. Dabur India Ltd. reiterated that Hajmola Tablets are Ayurvedic medicines. In a separate case, the Supreme Court in Dabur India Ltd. v. Commissioner of Central Excise, Jamshedpur emphasized that products should be classified based on their popular meaning and usage, supported by evidence such as Drug Controller's licenses and prescriptions from Ayurvedic doctors. The court, after considering the evidence presented by the petitioner, including possession of a trade license for the product, concluded that Hajmola candy should be classified as an Ayurvedic medicine under List-A of the Orissa Sales Tax Act. Therefore, the impugned orders of the Tribunal and the STO were set aside, ruling in favor of the petitioner and against the Department. In conclusion, the judgment clarified the classification of Hajmola candy as an Ayurvedic medicine for tax purposes under the Orissa Sales Tax Act, 1947, based on established legal principles and precedents.
|
