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AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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Issues: (i) whether the petitioner's product marketed as golden mixture/namkeens is a food or vegetative preparation; and (ii) whether the product is sold in air-tight containers so as to fall under entry 56 of the First Schedule to the Kerala General Sales Tax Act, 1963.
Issue (i): whether the petitioner's product marketed as golden mixture/namkeens is a food or vegetative preparation.
Analysis: The product was described on the packet as a crispy snack made of moth, channa flour, potato, edible oil, edible salt, spices and pulses. On that basis, it was treated as a nutritive snack item and therefore a food preparation. The contention that snacks of this kind are not food was rejected.
Conclusion: The product is a food or vegetative preparation.
Issue (ii): whether the product is sold in air-tight containers so as to fall under entry 56 of the First Schedule to the Kerala General Sales Tax Act, 1963.
Analysis: The packet was found to be sealed on either side with an inner plastic layer and outer aluminium foil, preventing air from entering and preserving crispiness. The expression "container" was construed broadly, and the use of flexible packing material was held sufficient. Section 5(3) of the Kerala General Sales Tax Act, 1963 was also referred to as showing that even packing materials of a wider kind can be treated as containers.
Conclusion: The product is sold in an air-tight container and falls within entry 56.
Final Conclusion: The product was held taxable under entry 56 of the First Schedule to the Kerala General Sales Tax Act, 1963, and the revisions failed.
Ratio Decidendi: For purposes of the sales tax entry, a snack preparation may constitute food, and a packet that effectively prevents entry of air is an air-tight container even if it is made of flexible packing material.
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