Predominant use controls goods classification, and a relief undertaking notification does not suspend statutory sales tax liability.

Classification under the relevant schedule entry turned on the predominant use of the goods; because they were mainly intended as components of crawler tractors and bulldozers, incidental other uses did not displace entry 55 or the single point levy. A relief undertaking notification under the Tamil Nadu Relief Undertaking (Special Provisions) Act suspended contractual and similar third-party obligations, but not a statutory sales tax liability. The tax demand therefore remained enforceable, and the assessee could not rely on the notification to avoid sales tax.

---

---

Issues: (i) Whether the goods manufactured by the assessee were correctly classified under entry 55 of the First Schedule to the Tamil Nadu General Sales Tax Act, 1959 and subjected to single point levy; (ii) Whether the notification issued under section 4 of the Tamil Nadu Relief Undertaking (Special Provisions) Act, 1969 suspended the assessee's statutory sales tax liability.

Issue (i): Whether the goods manufactured by the assessee were correctly classified under entry 55 of the First Schedule to the Tamil Nadu General Sales Tax Act, 1959 and subjected to single point levy.

Analysis: The goods were found to be primarily intended for use as components of crawler tractors and bulldozers. Their use for other purposes, including drilling machines, was not shown to be of any substantial magnitude. Where the main or predominant use of the goods is as tractor or bulldozer components, the possibility of some other use does not take them outside the relevant entry. The reasoning adopted in an earlier decision on spare parts used for tractors was applied to the present goods.

Conclusion: The classification under entry 55 and the single point levy were upheld, in favour of the Revenue.

Issue (ii): Whether the notification issued under section 4 of the Tamil Nadu Relief Undertaking (Special Provisions) Act, 1969 suspended the assessee's statutory sales tax liability.

Analysis: The notification was held to suspend contractual and similar obligations owed to third parties by the relief undertaking, but not liabilities arising directly under a taxing statute. A statutory sales tax demand was therefore outside the scope of the notification.

Conclusion: The notification did not suspend the assessee's sales tax liability, and the claim for relief failed, in favour of the Revenue.

Final Conclusion: The tax revisions and the writ petition both failed, and the assessee was held liable to the assessed sales tax without the benefit of the relief undertaking notification.

Ratio Decidendi: For classification under a tariff or schedule entry, the predominant use of the goods controls, and a relief notification confined to contractual obligations does not suspend a statutory tax liability.

---