Declared goods classification for imported sugar failed, allowing separate state taxation and upholding the levy.

Imported refined sugar was held not to fall within the specified tariff sub-headings in section 14(viii) of the Central Sales Tax Act, so it did not qualify as declared goods and could not claim the protections under section 15 or article 286. On that basis, the State was competent to treat imported sugar differently from sugar produced in India under the Tamil Nadu General Sales Tax Act, and the classification was not found to violate article 14; the challenges under articles 301 and 304 were not pressed. The levy and differential classification of imported sugar were upheld, and the connected petitions were dismissed.

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Issues: (i) Whether imported sugar was declared to be goods of special importance under section 14(viii) of the Central Sales Tax Act, 1956 and therefore subject to the restrictions under section 15 of that Act and article 286 of the Constitution of India. (ii) Whether exemption granted to sugar produced and manufactured in India while taxing imported sugar under the Tamil Nadu General Sales Tax Act, 1959 was violative of articles 14, 301 and 304 of the Constitution of India.

Issue (i): Whether imported sugar was declared to be goods of special importance under section 14(viii) of the Central Sales Tax Act, 1956 and therefore subject to the restrictions under section 15 of that Act and article 286 of the Constitution of India.

Analysis: The declaration in section 14(viii) was confined to sugar covered by the specified sub-headings in the Central Excise Tariff Act, 1985. The Tribunal held that the word "covered" required the commodity to fall within those precise tariff classifications and that imported refined sugar, on the facts and tariff structure, did not answer any of the included sub-headings. Since all sugar was not declared goods merely by reason of being sugar, imported sugar remained outside the declared goods category.

Conclusion: The issue was decided against the assessee and in favour of the Revenue; imported sugar was not declared goods under section 14(viii) of the Central Sales Tax Act, 1956.

Issue (ii): Whether exemption granted to sugar produced and manufactured in India while taxing imported sugar under the Tamil Nadu General Sales Tax Act, 1959 was violative of articles 14, 301 and 304 of the Constitution of India.

Analysis: Once imported sugar was held not to be declared goods, the State was competent to treat it separately from sugar manufactured in India for the purposes of the Tamil Nadu sales tax schedules. The challenge under articles 301 and 304 was not pressed, and the classification did not offend article 14 on the reasoning adopted by the Tribunal.

Conclusion: The issue was decided against the assessee and in favour of the Revenue; the differential treatment was upheld.

Final Conclusion: The Tribunal upheld the levy and the classification of imported sugar under the State taxing schedule, and the connected original petitions were dismissed.

Ratio Decidendi: Where Parliament declares only specified tariff-classified goods as declared goods, a commodity not falling within those specified sub-headings cannot claim the statutory protections attached to declared goods, and a State may classify and tax it separately.

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