2004 (4) TMI 553 - HC - VAT and Sales Tax

Classification of Mosquito Repellent Coil as Not Insecticide or Pesticide

Commissioner of Trade Tax, UP., Lucknow Versus Hindu Super Store

The High Court ruled that the mosquito repellent coil (kachhuwa chap agarbatti) should be classified as a mosquito repellent and not as insecticides or ... - Issues:1. Applicability of tax rate on mosquito repellent coil (kachhuwa chap agarbatti) under the category of 'pesticides and insecticides'.Analysis:The controversy in the present revision for the assessment year 1988-89 revolves around the tax rate applicability on mosquito repellent coil (kachhuwa chap agarbatti). The Tribunal concluded that this product falls under the category of 'pesticides and insecticides.' However, the assessing authority treated the mosquito repellent as an unclassified item, rejecting the dealer's argument that it should be classified as 'pesticides and insecticides.' The Assistant Commissioner (Judicial) supported this view, emphasizing that the product is a mosquito repellent and not a mosquito killer, therefore cannot be considered as a 'medicine.'In a previous case, the Court had ruled that a similar product, Odomos, is classified as a medicine despite being sold in shops other than medicine shops. The judgment of the Supreme Court in a different case emphasized that entries in sales tax acts should be interpreted based on common parlance rather than technical definitions.Moreover, the Supreme Court reiterated its stance on interpreting product classifications based on commercial parlance in a recent case involving a product called 'Lip Salve.' The Court held that the product should not be considered a medicine as it is not prescribed by doctors or available in chemist shops, aligning with the popular understanding of the product.In a separate case, the Supreme Court categorized 'Jet Mat' as a mosquito repellent rather than an insecticide under a specific entry in the Gujarat Sales Tax Act. The Court considered the composition of the product, including the presence of 'd-Allethrin 4 per cent,' and the registration under the Insecticides Act, to determine its classification as a mosquito repellent.Based on the above analysis, the High Court allowed the revision, stating that the mosquito repellent coil (kachhuwa chap agarbatti) cannot be categorized as insecticides or pesticides but should be considered a mosquito repellent. The order of the Tribunal was deemed unsustainable in this context, leading to the allowance of the petition without any costs.