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TMI Blog2014 (5) TMI 684X X X X Extracts X X X X X X X X Extracts X X X X ..... x at 3% on the sale of veneers against Form XVII and at 4% on the sale of timber to Government Departments. The Assessing Authority held that the said goods fell under the VI Schedule; hence, the question of applying concessional levy under Section 3(3) of the Tamil Nadu General Sales Tax Act, 1959 (hereinafter referred to as 'the Act') did not arise. Consequently, the assessment was completed applying rate of tax at 8% as the goods fall under the VI Schedule. The assessee filed an appeal before the Appellate Assistant Commissioner. Taking the view that veneer and timber are one and the same, timber being an item included under VI Schedule, the assessee was not justified in claiming concessional levy under Section 3(3) of the Act. Thus, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n both sides of the plywood. The maximum thickness of the veneer would go upto 1 mm. After peeling, the rest of the wooden logs having more than 1 mm thickness is called core veneer. This is used as an input between face veneer to constitute the thickness of the plywood. Consequently, the question of bringing it under the VI Schedule to reject the claim of the assessee, did not arise. 3. Learned Government Advocate, in support of the order passed by the authorities below, submitted that the assessee is not entitled to claim concessional levy as regards veneer and the same has to be treated as timber only. As already pointed out, the assessment herein relates to 1994-95. The relevant provision under Section 3(3) of the Act during the materi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed spirit, neutral spirit and denatured spirit], goods falling under Part A of the Third Schedule, goods falling under item 1 of the Sixth Schedule] and arrack, shall be at the rate of only three percent on the turnover relating to such sale. " 5. Prior to the inclusion of timber under the Sixth Schedule, the same was included under Item 23, Part D of the First Schedule. Subsequently, with effect from 1.4.1994, the same was brought under the Sixth Schedule under Entry 11 under the Act 32 of 1994, effective from 1.4.1994. Thus, on and from 1.4.1994 to 16.7.1996, timber was included under the Sixth Schedule assessable at the rate prescribed therein.Thereafter, from 17.7.1996, it was once again brought under First Schedule under Part 'C' Entr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would be entitled to claim concessional levy at 3% on the turnover relating to sale to a purchaser. 7. Going by the above-said provisions as they stood at the relevant point of time, the question of looking at the VI Schedule as such, does not arise, to reject the claim of the assessee. It may be of relevance to note herein that the VI Schedule falling under Section 3(2-B) of the Act was inserted under Act 28 of 1992, substituted by Act 31 of 1992 and again substituted by Act 25 of 1993. It is also not the case of the Revenue that the manufactured goods fell for consideration under the Sixth Schedule. 8. Learned Government Advocate pointed out that having regard to the specific mentioning as regards the First Schedule under Section 3(3) o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ded to restrict the applicability of the provision to the sale of only those goods falling under the First Schedule for the purpose of use in the manufacture of goods. On the other hand, the restriction on the claim for concessional levy is with reference to the sale of goods manufactured, using the materials purchased at a concessional rate . That is, the goods manufactured are to be those falling under the First Schedule other than Item 56 in Part D of the First Schedule and arrack. Thus, if these two conditions are satisfied, an assessee selling goods for use in the manufacture would be entitled to claim a concessional rate of tax under Section 3(3) of the Act. In considering any goods for sale to be used in the manufacture of goods, one ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t with by the assessee could not be called as timber. A mere look at the material produced before us shows that it is only a scrapped material which is under commercial parlance, called veneer to be used at the top of the plywood that had been sold by the assessee. Given the fact that the timber and veneer are commercially a different goods and that the entry in the Sixth Schedule contemplates "timber including sized timber, but excluding fire wood", the item dealt with by the assessee would not fall either under timber or sized timber. As such, we have no hesitation in accepting the plea of the assessee that the item in question cannot be brought under VI Schedule to reject the plea. 12. In the circumstances, the Tax Case Revision stands ..... X X X X Extracts X X X X X X X X Extracts X X X X
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