Classification of rosemary oil as scent or perfume failed where it was only a perfumery ingredient, not a commercial perfume itself.

Rosemary oil was held not to fall within Item 51 of the First Schedule to the Tamil Nadu General Sales Tax Act, 1959 as a scent or perfume. The tribunal reasoned that the oil was only a component or base ingredient used in perfumery, not a commercially recognised scent or perfume sold or understood in its own right. In the absence of evidence that the market treated it as perfume or scent, it could not be classified under the entry merely because it was capable of use in making perfumes. The revision enhancing the tax liability was therefore not justified, and the original assessment was restored.

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Issues: Whether rosemary oil fell within Item 51 of the First Schedule to the Tamil Nadu General Sales Tax Act, 1959 as scents or perfumes, and whether the revision enhancing the tax rate was sustainable.

Analysis: Rosemary oil was found to be only one of the components used in making perfumes and not an article sold or purchased as scent or perfume by itself. The material on record showed it to be a base oil or an ingredient capable of use in perfumery, but not a commercially recognised perfume or scent in its own right. In the absence of evidence that the market or consumers treated it as perfume or scent, components could not be brought within the entry merely because they may be used in perfumery.

Conclusion: Rosemary oil did not fall under Item 51 of the First Schedule, and the revision enhancing the tax liability was not justified.

Final Conclusion: The original assessment was restored and the assessee obtained relief on the disputed turnover at the lower rate.

Ratio Decidendi: A product used as an ingredient in perfumes is not taxable as scent or perfume under a tariff entry unless it is shown to be commercially sold and understood as such in its own right.

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