TMI Blog2017 (4) TMI 1241X X X X Extracts X X X X X X X X Extracts X X X X ..... w, the products make it abundantly clear that these are meant for water proofing or as bonding agent as evident from the very features shown by the assessee and considered by the lower authorities. These products have direct bearing on the water proofing and cement binding activities relating to building/civil works and cannot be treated to be “industrial inputs” under Part ‘B’ of Schedule-IV of the Act. Once the products do not fall in specific entry 69 as claimed by the assessee or as “industrial inputs”, it has to fall in Schedule-V. Merely because some chemical is applied, it even otherwise does not prove that it falls in the ambit of “industrial inputs”. The above Dr. Fixit Series of products as they stand, have in my view been rightly held to be either water proofing materials or binding substances in category of building material used in construction works, like sealant, paints etc. and such products are generally and directly used by the consumers in construction works and could not be covered in the ambit of “industrial inputs” as contended by the learned counsel for assessee. Having analysed entry no.268 of Part ‘B’ of the Schedule (supra), the items as are consumed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee did not give bifurcation of the sale product-wise and after granting several opportunities, the assessee gave details as also literature of the various products. It appears from the assessment order that despite opportunities having been granted thereafter too, the assessee did not produce the relevant records / details and justify its claim that the product being sold fell in which category of Schedule-IV. The assessee at a later stage gave details with entry as under :- 5. The AO went into detail of the products being sold and after analysing the entries vis-a-vis the product classified, while he was satisfied that a few products were taxable @ 4% and held so, however, insofar as the majority of Dr. Fixit products are concerned as referred to hereinbefore and a few other products with the sale value of ₹ 82,78,289/-, held that they do not fall in any of the entries of Schedules-I, II, III IV and when they do not fall in any of the Schedules-I to IV, then it has to be taxable at the rate shown in Schedule-V and accordingly applied the rate of 12.5% and since 4% was paid, charged differential tax @ 8.5%. The AO, took into consideration the entries whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n industry and related works are industrial inputs classifiable under entry 69 as industrial inputs of Schedule-IV or the residual entry no.1 of Schedule-V? (ii) Whether the learned Tax Board and lower authorities were legally justified in deciding the issue as to whether Dr. Fixit Series of Products are pure and simple chemicals having a composition of several constituents inter alia including those of chemical nature and ignoring the test reports on National Test House of Government of India which certified the product as chemicals? 11. Learned counsel for the assessee vehemently contended that Dr. Fixit Series of products, as they stand, are mainly chemical additives used in construction industry for modification of concrete or mortar to impart water proofing and bonding characteristics to concrete or mortar, and thus these products are used to impart strength, density and impermeability to concrete, with different formulations. Some of the products are used in construction industry before coating or painting of concrete to take care of expansion of contraction of joints, with different formulations. These are basically chemicals, used by construction industry in place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 3824 40 10 --- Damp proof or water proof compounds kg. 12.5% 3824 40 90 --- Other 13. Learned counsel also relied on Dhian Singh v. Municipal Board, Saharanpur (1969) 2 SCC 371, Amar Chandra Chakraborty v. The Collector of Excise, Govt. of Tripura, Agartala Others (1972) 2 SCC 442, Collector of Customs, Madras v. Lotus Inks 1996 (87) E.L.T. 580 (S.C.), Poulose Mathen v. Collector of Central Excise 1997 (90) E.L.T. 264 (S.C.), Assistant Commissioner (Intelligence) v. Nandanam Construction Co. (1999) 8 SCC 69, Commissioner of Central Excise, Calcutta v. Sharma Chemical Works (2003) 5 SCC 60, Quinn India Ltd. v. Commissioner of Central Excise, Hyderabad (2006) 9 SCC 559, Maharashtra University of Health Sciences Others v. Satchikitsa Prasarak Mandal Others (2010) 3 SCC 786, Glaxosmithkline Pharmaceuticals Ltd. Others v. State of Madhya Pradesh (2011) 13 SCC 72, M.P. Agencies v. State of Kerala (2015) 7 SCC 102, Tata Chemicals Ltd. v. Commissioner of Customs (Preventive), Jamnagar (2015) 11 SCC 628, Commissioner of Central Excise, Mumbai v. Associated Cement Company Ltd. (2015) 15 SCC 795, Assistant Commissioner, Anti Evasion, Rajasthan-I, Jaipur v. M/s Camlin Lim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), Mauri Yeast India Pvt. Ltd. v. State of U.P. Another (2008) 5 SCC 680, Raja Brick Tile Industries v. The Addl. Commissioner of Commercial Taxes, Zone-II Anr. [2006] 146 STC 124 (Kar), RayBan Sun Optics India Ltd. v. Dy. Commissioner (Appeals), Commercial Tax Department 2015 (1) RLW 669 (Raj.). 15. I have considered the arguments advanced by the learned counsel for the parties and have perused the material on record. 16. It would be appropriate to quote entry 69 of Schedule- IV and Sl. no.268 of Part 'B', Schecule-V, while the claim of the assessee is that it falls in item 69 of Part 'B' Sl. no.268 but the claim of the Revenue is that it falls in Schedule-V as it is not covered in the specific entries:- Schedule-IV Goods Taxable at 4% 69 Industrial Inputs as specified in Part-B of this Schedule. 4% Part-B Goods under category of Industrial Inputs 268 Chemicals not specified elsewhere in this Schedule or in any other Schedule (added vide notification No.F.12(28) FD/Tax/2007-138 dated 9.3.2007 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r, which when mixed with accelerator (curing agent) cures by chemical reaction to from a tough, flexible rubber seal. This sealant has excellent adhesion to different surface like, masonary, concrete, timber, glass, aluminium etc., with excellent movement accommodation. Dr. Fixit Pidiseal It is a semi viscous, non safe hardening type of sealant. The product meets BS 5920 as safe sealant for potable water. Dr. Fixit Pidipoxy Is a self leveling epoxy ESL topping over cementitious substrates applied from 1.5 mm to 3 mm thickness, providing a hard-waring attractive floor, chemical resistant, seamless, and extremely easy to clean. 21. Having noticed some of the products and earlier also highlighted, in my view, these products have direct bearing on the water proofing and cement binding activities relating to building/civil works and cannot be treated to be industrial inputs under Part B of Schedule-IV of the Act. Once the products do not fall in specific entry 69 as claimed by the assessee or as industrial inputs , it has to fall in Schedule-V. Merely because some chemical is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve on the contrary a description of the utility of products as water proofing/bonding materials used as sealants, plasticizing agents, concrete curing compounds and related works, which makes them in common parlance marketable end products with distinct nomenclature of sealants and plasticizing bonding materials. 27. The Apex court in the case of Mauri Yeast India Pvt. Ltd. v. State of U.P. (supra) has held as under :- It is now a well settled principle of law that in interpreting different entries, attempts shall be made to find out as to whether the same answers the description of the contents of the basic entry and only in the event it is not possible to do so, recourse to the residuary entry should be taken by way of last resort. 28. In view of what has been noticed hereinbefore, the judgments relied upon by the learned counsel for the assessee, being not direct on the issue or remotely even touches the controversy, are not required to be referred to and are either inapplicable or distinguishable on facts. 29. In view of what has been observed hereinabove, the assessee is unable to satisfy this court that the products as they stand, fall in entry 69 and 268(Part-B ..... X X X X Extracts X X X X X X X X Extracts X X X X
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