TMI Blog2019 (5) TMI 643X X X X Extracts X X X X X X X X Extracts X X X X ..... terms of Notification No.2/2017-Central Tax (Trade) dated 28th June, 2017 i.e. Entry No.119 thereunder, such goods classifiable under HSN 49.01 i.e. printed books, including Braille books are wholly exempted from tax. Since, this is the only question that has been raised before the Court, the impugned order dated 9th April 2018 to that extent is hereby set aside - petition allowed. - W.P.(C) 10022/2018 & CM 39032/2018 (stay) - - - Dated:- 7-5-2019 - S. MURALIDHAR AND REKHA PALLI JJ. Petitioner Through: Mr. Vineet Bhatia, Advocate. Respondents Through: Mr. Amit Bansal and Mr. Aman Rewaria, Advocates for R-3. Mr. Satyakam, Addl. Standing Counsel, GNCTD. O R D E R Dr. S. Muralidhar, J.: 1. A very short but interesting question that arises for consideration in the present petition is whether the books Sulekh Sarita Parts I to V are Printed Books classifiable under HSN 4901 or Exercise Books under HSN 4820 of the Central Goods and Service Tax Act (CGST Act)? If the books are classified under HSN 4901, as contended by the Petitioner, then they would be completely exempt from tax in terms of the CGST Act as well ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcises (usually with spaces for completion in manuscript). Thus, printed work books containing questions followed by spaces for writing or other exercises would fall within the scope of Chapter 49. The said goods are different from Exercise Books falling under Chapter 48 which are stationary items with blank pages with lines for writing and some time may also include printed texts for copying manually, as explained in the preceding para. Further, since printing in case of printed workbooks is not merely incidental to the primary use of the of the goods, such goods are classifiable under Chapter 49, in terms of Chapter note 12 to Chapter 48 of erstwhile CETA, 1985. (iv) Similarly, HSN Chapter note (6) to Chapter 49 read with HSN explanatory note under heading 49.03 covers children's workbooks consisting essentially of pictures with complementary texts, for writing or other exercises, and children's drawing or colouring books, provided the pictures form the principal interest and are not subsidiary to the text. Thus, children's drawing books which are in harmony with said HSN Chapter note (6) and HSN Explanatory note to heading 4903 would fall under Chapter 49. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g 49.01 contained questions or exercise within the space given for writing the answers whereas, the exercise books under Heading 48.20 contained printed text with space for copying manually. (iii) An examination of the books printed and sold by the Petitioner revealed that only in very few pages, any printed exercise or questions is given. Hence, in these books, the primary use is writing and printing is incidental . Further since none of the books contained any pages with children's picture , drawing or colouring matter , classification of any of them under heading 49.03 is not possible. Therefore, the goods were to be correctly classified under HSN 4820. 8. This Court has heard the submissions of Mr Vineet Bhatia, learned counsel for the Petitioner, Mr Amit Bansal learned counsel for the Principal Commissioner, GST and Mr Satyakam, Addl. Standing Counsel, GNCTD. This Court has also examined the books printed by the Petitioner, viz., Sulekh Sarita Parts I to V. Illustratively, the Court would like to refer to Sulekh Sarita Part V. 9. To begin with, the name of the author of the book is prominently printed on the first page as is the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t think of his or her own topics and write a few sentences on the topic. 13. This Court, therefore, is not persuaded to concur with the assessment made by the AAR of the above book that only in very few pages, any printed exercise or questions is given. An educational text is like a handholding exercise for a child. While in the first few pages, it may appear that the child is asked to mechanically reproduce from the printed text, as the course progresses, the child is encouraged to think on his or her own. This is what precisely this work book , or as the Court would like to rephrase it, this practice book does. At the end of the course, by using these books, the attempt is to enhance the educational value addition as far as the child is concerned. The attempt is to help the child think on his own and to enable the teacher to evaluate the child s output. By no means can it be said that these books are for enabling a child to merely copy words from a printed text in order to improve his or her own handwriting. 14. The Court is conscious that in the note appended to the HSN, it has been stated that Heading 49.01 excludes children s workbook consistin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of sheets of paper or of other substance, having suitable size, shape and value, bound together at one edge so as to form a material whole and protected on the front and back with covers of some kind and functionally useful to the assessee for carrying on his business or profession. 16. Therefore, the emphasis was on a functional characteristics of a book. In other words, the Court must ask what purpose will the book serve? In this case, a question to be asked is whether the books in question merely help the child in improving the child s handwriting by providing space in a book by copying from a written text or does it pose questions to the child to answer and whether the teacher then can evaluate, on the basis of such answers, the child s ability and understanding? In the present case, the work books or practice books printed and sold by the Petitioner certainly fall in the latter category i.e. they test the child s knowledge, ask questions which the child has to answer, and facilitate evaluating the child s understanding. 17. These books are not exercise books as understood by the trade. It must be mentioned at this stage that the learned counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X
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