Processed vegetable classification for potato chips: inclusive tariff entry prevails over residuary rate when essential character remains unchanged.

Potato chips were treated as processed vegetables within entry 6 of Schedule II(B) of the Uttaranchal Value Added Tax Act, because the inclusive wording of the entry covered processed and preserved vegetables and the absence of an express exclusion supported inclusion. The processing of slicing, frying and spicing did not destroy the potato's essential character or create a wholly new commodity, so the specific entry prevailed over the residuary entry. The commodity was therefore taxable at the lower rate under the specific schedule entry rather than under the residuary rate.

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Issues: Whether potato chips are a processed vegetable falling under entry 6 of Schedule II(B) of the Uttaranchal Value Added Tax Act, 2005, and therefore taxable at 4%, or whether they fall in the residuary category taxable at 12.5%.

Analysis: Entry 6 of Schedule II(B) is an inclusive entry covering all processed and preserved vegetables, with the words "all" and "including" indicating a broad legislative sweep. The absence of any exclusion for potato chips, contrasted with express exclusions in other entries, supported the inference that items not excluded were intended to be included. Potato remains a vegetable even after slicing, frying and spicing, and the process does not destroy its essential character or create a wholly new commodity. The Court also relied on the principle that a specific or direct entry must be preferred to the residuary entry, and on contemporaneous administrative understanding that potato chips are treated as a vegetable product.

Conclusion: Potato chips are a processed vegetable covered by entry 6 of Schedule II(B) and are taxable at 4%, not 12.5%.

Ratio Decidendi: Where a taxing entry is inclusive in nature and the commodity retains its essential character after processing, the specific entry applies and the residuary entry cannot be invoked.

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