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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: Whether the product manufactured by the assessee was correctly classified under the Gujarat Sales Tax Act, 1969 as goods covered by the residuary entry, or whether it fell within the specific entry for articles made of stainless steel.
Analysis: The product was found to be specially manufactured from stainless steel wire mesh for industrial applications and to be used according to specifications for different purposes. The determining factor for classification was the nature and ordinary use of the article, and an item made to serve as part of a particular apparatus does not lose the benefit of the specific entry merely because it may be capable of some other use. On the facts, the product was not a mere hardware item falling in the residuary entry. Entry 132(iv), which covered utensils made of other metals and articles made of stainless steel, was held applicable.
Conclusion: The classification under the residuary entry was erroneous and the goods were held to fall under the specific entry for articles made of stainless steel, in favour of the assessee.
Final Conclusion: The reference was answered for the assessee and the appeals were allowed.
Ratio Decidendi: For classification purposes, a specially manufactured article must be placed in the specific entry answering its ordinary and intended use, and not in a residuary entry, merely because it may have other possible applications.
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