Brochures taxed as printed material, while instant porridge retained exemption under the VAT schedule.

Brochures sold under the Uttar Pradesh VAT Act, 2008 were treated as promotional printed material rather than books or periodicals, because the Act separately classified books from printed material and ambiguity in exemption entries was resolved in favour of the Revenue; the exemption under Entry 7 was therefore denied. Instant porridge, however, was held to fall within the exempted entry for porridge under Schedule-I, since the text of Entry 36 made no distinction between ordinary and instant porridge and no exclusion could be read into it. The assessee therefore failed on brochure classification but succeeded on instant porridge.

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Issues: (i) Whether brochures sold by the assessee were covered by the exemption for books and periodicals under Entry 7 of Schedule-I of the Uttar Pradesh Value Added Tax Act, 2008, or were liable to tax as printed material under Entry 100 of Part-A of Schedule-II; (ii) Whether instant porridge was excluded from the exempted entry for porridge under Entry 36 of Schedule-I.

Issue (i): Whether brochures sold by the assessee were covered by the exemption for books and periodicals under Entry 7 of Schedule-I of the Uttar Pradesh Value Added Tax Act, 2008, or were liable to tax as printed material under Entry 100 of Part-A of Schedule-II.

Analysis: The charging and exemption scheme under Section 7 of the Act distinguished between goods exempted under Schedule-I and goods taxable at 4% under Schedule-II. Entry 7 specifically covered books, periodicals and allied items, while Entry 100 specifically covered printed material including diary and calendar. The earlier decisions under a different notification regime were held inapplicable because the 2008 Act created a specific classification between books and printed material. Brochures were treated as promotional and advertising material falling within printed material. The rule governing exemption clauses is that any ambiguity must be resolved in favour of the Revenue.

Conclusion: The brochures were not entitled to exemption under Entry 7 and were rightly taxed as printed material under Entry 100; this issue was decided against the assessee.

Issue (ii): Whether instant porridge was excluded from the exempted entry for porridge under Entry 36 of Schedule-I.

Analysis: Entry 36 of Schedule-I exempted porridge without making any distinction between normal porridge and instant porridge. No statutory basis was found for reading such a distinction into the entry. The Tribunal's view that instant porridge was outside the exempted category was held unsustainable because the legislative language did not carve out any exclusion.

Conclusion: Instant porridge fell within the exempted entry for porridge and the assessee was entitled to the benefit; this issue was decided in favour of the assessee.

Final Conclusion: The revisions challenging the brochure classification failed, while the challenge relating to instant porridge succeeded, resulting in only limited relief to the assessee.

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