TMI Blog2018 (5) TMI 717X X X X Extracts X X X X X X X X Extracts X X X X ..... is no substantial change in the commodities and that the powders are not again liable to sales tax. Revision dismissed - decided against Revenue. - T.C.(R).No.79 of 2018 - - - Dated:- 28-3-2018 - S. Manikumar And M. Govindaraj, JJ. For the Petitioner : Mr.V.Haribabu Additional Govt. Pleader (Taxes) ORDER ( Order of this Court was made by S. Manikumar, J. ) Tax Case Revision Petition is filed to revise the order dated dated 06.02.2012, passed in S.T.A.No.50 of 2004, on the file of the Tamil Nadu Sales Tax Appellate Tribunal (Additional Bench), Chennai, by which, the Tribunal upheld the order of the Appellate Assistant Commissioner, setting aside the assessment on a turnover of ₹ 1,19,000/- at 11% and penalty. 2. Short facts leading to the Tax Case Revision are that Tvl.Lalchand Bhimraj was finally assessed for the year 1996-97 under the Central Sales Tax, 1956, on a total and taxable turnover of ₹ 1,53,86,140/-, by the Commercial Tax Officer, Evening Bazaar Assessment Circle, vide proceedings CST.No.21032/96-97, dated 29.08.2002. The appellant has disputed the assessment sale of sugar and levy of penalty of ₹ 19,734/-, under section 9(2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n his order, dated 29.08.2002, has observed as follows: When they sold sugar N.F. for ₹ 1,19,600/- vide invoice No.11161/24.8.96 to Tvl.Saith Kline Beachem Asia Private Limited, Bangalore. It was intercepted at Poonamalle Checkpost on 21.08.96 and detained as the goods transported are different from the goods noted in the invoice. They moved the Tamil Nadu Taxation Special Tribunal for the release of the goods. The Tribunal in its order in OP.1491 of 1996, dated 06.09.1996 has directed to release the goods on furnishing a bank guarantee for a sum of ₹ 15,000/- and sending the sample for test. The Government analyst, Food analysis Laboratory, King Institute, Guindy, Chennai-32, in their test reported has opined that the sample of sugar powder was analysed and found that it contain starch, sucrose total ash and ash insoluble. Thus, it is clear that the goods dealt by the dealer is not sugar and is proposed to be treated as taxable general goods and it is proposed to levy tax at 11% on the turnover of ₹ 10,81,080/-. The Learned Advocate who has appeared at the time of final hearing has argued that sucrose is sugar and the Assessing Officer has levie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ding to oxford dictionary Sucrose means a compound which is the chief component of cane or beat sugar'. The argument of the learned Advocate is reasonable and justifiable in view of the case Law referred supra. The contention of the Assessing Officer that the item contains 4% starch cannot be taken as valid ground for rejecting the claim of the appellants which is very negligible which has also been decided in the court of law in the cases referred supra. In view of the above, the assessment made by the Assessing Officer on a turnover of ₹ 1,19,600/- at 11% is set aside. PENALTY: The Assessing Officer has levied penalty of ₹ 19,734/- towards the balance of tax assessed and paid. The Learned Advocate has also argued that penalty levied by the Assessing Officer is wrong since the assessment is made under Section 12(1) and not under Section 12(2). Penalty cannot be levied in view of the decision reported in 28 STC 700 and 125 STC 505. The arguments of the Learned Advocate is reasonable and justifiable. Penalty cannot be levied in view of the decision referred supra. Therefore, the penalty levied is deleted. In fine, the appeal stands ALLOWED. 5. Again ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ether the Tribunal is right in holding that the dealer has purchased sugar, when they categorically admitted before the Tamil Nadu Sales Tax Appellate Tribunal that the product is sugar N.F. according to standard specification of N.F. (National Farinuiary, USA) and it is used as sweetening agent in medicines. (2) Whether the Tribunal is right in holding that the dealer dealt with goods is only sugar whereas the goods claimed by the dealer as Sugar N.F. (3) Whether the Tribunal is right in holding that the product is sugar when the Government analytical report specify that the goods in question is having 96% of Sucrose and rest of 4% Starch and Ash as insoluble. (4) Whether the Tribunal has erred in not considering the report submitted by the Government Food Analyst Laboratory, King Institute which opined that the product is mixture of sucrose and starch and therefore, it can be safely presumed that the product is not 100% sugar. (5) Whether the Tribunal is right in holding that the commodity is sugar whereas the dealer themselves admitted it is sweetening agent used for medicines. (6) Whether the tribunal is right in deleting the penalty levied under sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , if expressed as a percentage of the material dried to constant weight to 105 degree centigrade, would be more than ninety. 10. It is the admitted case of the State that the sample of the consignment, viz., sugar powder, was sent to the Government Analyst, viz., Food Analysis Laboratory, King Institute, Guindy, Chennai-32, for testing and that the same was found to have contained 96% of sucrose and about 3% of corn starch. 11. In Rasoi Products v. Commercial Tax Officer reported in (1982) 51 STC 248 (Cal), the Calcutta High Court held that when pepper, black pepper, white pepper and turmeric are powdered, there is no substantial change in the commodities and that the powders are not again liable to sales tax. 12. In Ram Bhadur Takkur Takkur (P) Ltd. v. Coffee Board reported in [1991] 80 STC 199, this Court held that when coffee seeds are powdered and coffee powder results, there is no substantial change in the identity of the two goods for purposes of sales tax. 13. In New Swastik Flour Mill v. State of Karnataka reported in [1992] 84 STC 49, following the Patna High Court decision in Dhanbad Flour Mills v. State of Bihar [1989] 75 STC 47, the Karnataka High Court h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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