VAT classification of furniture requires statutory schedule interpretation rules; omission to apply them justified remand.

Classification of furniture for VAT depended on applying the statutory schedule-interpretation rules under the Kerala Value Added Tax Act, including HSN-based entries, common parlance where HSN is absent, and ejusdem generis where "other" is used. The Tribunal's classification in favour of the dealer was held unsustainable because it was made without applying that mandatory interpretative method, which went to the root of the adjudication. The Court also noted that the earlier CESTAT outcome was not conclusive for this classification dispute, though it could have persuasive value. The Tribunal's order was set aside and the matter was remitted for fresh consideration in accordance with law.

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Issues: Whether the Tribunal could uphold the dealer's claim for the concessional rate of tax on the furniture sold without first applying the statutory rules for interpretation of the schedules under the Kerala Value Added Tax Act, 2003, and whether the matter required remand for fresh consideration.

Analysis: The dispute concerned the correct classification of the furniture sold by the dealer and the applicable rate of tax. The statutory scheme required the authorities to interpret schedule entries by applying the prescribed rules of interpretation, including the effect of HSN-based entries, common parlance where HSN is absent, and ejusdem generis where the word "other" is used. The Tribunal decided the classification issue in favour of the dealer without referring to or applying those interpretative rules. That omission was treated as going to the root of the adjudication, because classification under the VAT schedule could not be determined by an independent factual assessment divorced from the statutory method of interpretation. The Court also declined to treat the earlier CESTAT outcome as conclusive for the present classification dispute, though it could have persuasive value.

Conclusion: The Tribunal's order was set aside and the matter was remitted for fresh consideration in accordance with law, with liberty to the dealer to place relevant material and contentions on record.

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