TMI Blog1994 (2) TMI 278X X X X Extracts X X X X X X X X Extracts X X X X ..... s were multi-point goods taxable under section 5(1)(ii), and not exempted under section 9 read with item 7 mentioned earlier. A new item 100B was added to the First Schedule to the Act with effect from April 1, 1984, bringing "pile carpets" to tax at 15 per cent single point, at the point of first sale in the State, with the result, the petitioner was assessed to tax at 15 per cent in the year 1984-85 on their sale of carpets. Petitioner's appeals against these assessments for the years 1983-84 and 1984-85 were not successful before the Appellate Assistant Commissioner, but the Appellate Tribunal in second appeal, set aside the assessment for the year 1983-84 in the view that woollen carpets continued to be within the purview of item 7 of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counsel, they were "woollen fabrics" within the purview of item 7 of the Third Schedule to the KGST Act. Item 7 not having been amended it should prevail over item 100B of the First Schedule. Item 7 of the Third Schedule, as it stood in 1984-85, made an exemption in respect of the tax payable on woollen fabrics as defined in item No. 21 of First Schedule to the Central Excises and Salt Act, 1944 ("the Central Act", for brevity). The First Schedule to the Central Act was amended with effect from April 1, 1979, by adding a new item No. 22-G relating to floor coverings, namely carpets, carpeting and rugs. Simultaneously Explanation III was added to item No. 21, excluding floor coverings falling under item No. 22-G from the purview of item No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ule were words of reference, citation or incorporation the provisions of item 7 grew or shrank with the changes in the parent statute, namely, the Central Act. Therefore, the question of exemption under item 7 has to be adjudged with reference to the provisions of the Central Act as they stood at the relevant time, which so far as this case is concerned, is 1984-85. If during that period, carpets dealt with by the petitioner were not comprehended within item No. 21 of the First Schedule to the Central Act, petitioner cannot stake claim for any exemption for the same under the KGST Act. I have already pointed out that item No. 21 underwent a change in 1979 by which floor coverings were taken out of the purview of item No. 21 of the Central A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ortance) Act, 1957 (hereinafter referred to as "the Additional Duties Act"). The contention is that additional excise duty is levied pursuant to an agreement with the State, by which the State shall not levy sales tax on goods covered by the said Act, for which the State will be compensated by payment of a share of the additional excise duty levied under the said Act. This contention has to fail for two reasons. Section 2(c) of the Additional Duties Act defines "woollen fabrics" as having the same meaning as that assigned to it in item No. 21 of the Central Act. During the year 1984-85, as pointed out by me earlier, carpets had gone out of this item by virtue of Explanation III thereto so that nothing prevented the State from levying sales ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... section 14 of the Central Sales Tax Act. Here again, section 14 describes woollen fabrics as defined in item No. 21 of the First Schedule to the Central Act and therefore the amendments to the Central Act automatically restrict the applicability of section 14 of the Central Sales Tax Act, 1956. Therefore, when woollen carpets went out of item 21 in the Central Act by the Amendment Act of 1979, automatically, section 14 ceased to apply to carpets and the restrictions imposed by section 15 no longer operated in relation to woollen carpets. 6.. All the contentions raised by the petitioner are therefore unsustainable. The original petition is dismissed without however any order as to costs. Writ petition dismissed. - - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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