TMI Blog2010 (3) TMI 1031X X X X Extracts X X X X X X X X Extracts X X X X ..... held that the uninterrupted power supply (UPS) sold by the appellant does not fall in entry 60 of Schedule B and hence the same would be chargeable at 12.5 per cent and not four per cent which is applicable to the items given in Schedule B. The Tribunal had restored the order of the Assessing Authority and had set aside the order of the first appellate authority, wherein it was held that the item being sold by the appellant, i.e., UPS is taxable at four per cent and it is not an unclassified item. Briefly the facts of the case are that the appellant is a dealer duly registered under the provisions of the Punjab Value Added Tax Act, 2005 and is engaged in the business of purchase and sale of electrical goods including UPS, inverters and batteries, etc. As far as the sale of inverters and batteries is concerned, the appellant-dealer has paid tax at the rate of 12.5 per cent but on the sale of UPS, tax was paid at the rate of four per cent in accordance with entry 60 of Schedule B attached to the Punjab VAT Act, 2005. The appellant was selling microtek digital inverters manufactured by Microtek International. Initially, up to the first quarter of 2006-07 the appellant had been sel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of such goods and there is no other entry under which it can fall? Mr. Sandeep Goyal, counsel for the appellant-assessee, has argued that the goods in question, i.e., UPS, have been found to be UPS even by the Assessing Authority and as such the same has to be taxed at four per cent which is applicable for sub-entry (27) of entry 60 of Schedule B attached to the Punjab Vat Act. According to the appellant, the entry contains the description uninterrupted power supply and there is no condition attached to the same which shows that the same is required to be used only for IT products. According to the appellant, a reading of entry 60 and sub-entries mentioned therein shows that each item has to be determined on its own and there is no condition attached with regard to its usage so as to disqualify the UPS being sold by the appellant from the UPS which is meant solely for IT products. Another argument of the appellant is that the Tribunal was wrong in holding that the usage would determine the classification of goods. According to the appellant, he is selling the goods in the market through the retailers and is not in a position to determine as to what use the goods would b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Calcutta [2006] 145 STC 625; [2006] 6 RC 403; [2006] 196 ELT 400, the honourable apex court has held in para 38 in STC as under: (3) The residuary entry is meant only for those categories of goods which clearly fall outside the ambit of specified entries. Unless the Department can establish that the goods in question can by no conceivable process of welding be brought under any of the tariff items, resort cannot be had to the residuary item. (ii) In the case of Bharat Forge Press Industries (P) Ltd. v. Collector of Central Excise [1992] 84 STC 414; [1990] 45 ELT 525, the honourable apex court has held in para 3 as under (page 415 of 84 STC): (3) The question before us is whether the Department is right in claiming that the items in question are dutiable under tariff entry No. 68. This, as mentioned already, is the residuary entry and only such goods as cannot be brought under the various specific entries in the tariff should be attempted to be brought under the residuary entry. In other words, unless the Department can establish that the goods in question can by no conceivable process of reasoning be brought under any of the tariff items, resort cannot be had to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In any event, such a question must be determined having regard to the expert opinion in the field. We have noticed hereinabove the difference between 'bone meal' and 'crushed bone'. Different utilities of the said items has also been noticed by the Allahabad High Court itself. The High Court or for that matter, the Tribunal did not have the advantage of opinion of the expert to the effect as to whether crushed bones can be used only for the purpose of fertilizer or whether crushed bones are sold to the farmers for use thereof only as fertilizer. Yet another argument of the appellant is that once there is an ambiguity or confusion with regard to classification of the goods, then the same is required to be decided in favour of the assessee as the benefit of such an ambiguity should be resolved in favour of subject as has been held by various courts. Reliance in this regard is placed upon the judgment of the honourable Supreme Court in the case of Commissioner of Central Excise, Calcutta v. Calcutta Springs Ltd. [2008] 229 ELT 161, wherein a Bench of the honourable Mr. Justice S.H. Kapadia and honourable Mr. Justice B. Sudershan Reddy have held that in classificati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... counsel that the UPS used for purposes other than information and technology could not be taxed at a lesser rate by giving it a wider consideration. Counsel for the State has also contended that the test reports given by the Indian Institute of Technology, Delhi, and the Punjab Engineering College, Chandigarh, could not be the basis for coming to the conclusion that the goods being sold by the appellant were UPS. The learned counsel has contended that the provisions of the statute cannot be ignored and the test reports with regard to the product being sold by the appellant could not get precedence over what has been mentioned in the statute. We have heard the counsel for the parties at length and have perused the record. The product in question is UPS-EB. This product is an electronic power source which stores the energy in batteries connected to it when the AC source is present and converts this energy automatically to AC power when the input AC source fails and automatically feeds so generated AC powers to loads connected and returns to main when the AC source comes back to the input side. The appellant deals with inverters and UPS supplied by the company having tradema ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 400 the Supreme Court has held that a residuary entry is meant only for those categories of goods which fall outside the ambit of specified entries. In the present case, sub-entry (27) of entry 60 specifically lays down that UPS would be taxed at the rate of four per cent. As noticed above, the product being sold by the appellant is UPS. This has also been certified to be so by the Engineering Department of IIT, Delhi, and by the Punjab Engineering College. Thus, the product being sold by the appellant cannot fall in the residuary category but would be covered by sub-entry (27). In Bharat Forge Press Industries (P) Ltd. [1992] 84 STC 414; [1990] 45 ELT 525, the apex court has held that merely because goods after processing become different commercial commodity or have a distinctive name does not change excise classification if they continued to be goods of same species. In view of the above, we hold that the goods in question sold by the appellant fulfil all the conditions of an UPS and hence they are taxable at the rate of four per cent. In view of the aforementioned discussion, the answer to question (i) is that the product, i.e., UPS-EB sold by the assessee falls ..... X X X X Extracts X X X X X X X X Extracts X X X X
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