TaxTMI 
TaxTMI 
1975 (12) TMI 104
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....al Total 1,71,114.85 2% 3-1/2% . 1,14,777.68 1,17,240.68 . . . . Taxable Taxable . . . . 1,50,430.95 1,71,114.85 . . . The original assessments were completed adopting 2% as rate of stiff collar in view of G.O. Press 4435, Revenue dt. 30th Nov., 1962 which reads as under :-- "Order:-- Under the Madras General Sales Tax Act, 1959 the tax payable on the sales of ready-made garments and handwoven quilt beds and pillows was reduced from 2 per cent to 1 per cent (multi-point) with effect from 1st April, 1959. The Government decided to levy tax at the rate of 1 pre cent on all read-made goods (both garments and non-garments) made of cloth instead of restricting the concession to garments, handwoven quilt beds and pillows alone. The notification annexed to this order will be published in the Fort St. George Gazette:-- (By order of the Governor) K.S. Sivasubramanyam Addl. Secretary Co. Government. ANNEXURE NOTIFICATION In exercise of the powers conferred by s. 17 of the Madras General Sales tax Act, 1959 (Madras Act I of 1959), and in suppression of the Revenue Department Notification SROA. 1967 of 1959, dt. the 28th March, 1959, published at page 490 of Par....
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....ods. According to the G.O. in which the notification was issued, the ready-made goods made of cloth is subject to concessional rate of 2 per cent only. Now the question is whether the stiff collars sold by the appellants are made of cloth. When the appellants were asked to prove whether this is made of cloth only. But they could not be able to do so. It is now found that the Board in its B.P. Rt. 589/13th Feb., 1975 has explained the case of the appellants on his application for clarification on this point and informed the appellants that the sample of stiff collar sent by them contains plastic goods also and that therefore it is subject to multi point. It is therefore held that the sales of stiff collars are not wholly made of and that they are subject to multi point only and the assessing officer had rightly assessed the appellants under multi point at 3-1/2 per cent". The appellant has therefore come up in second appeal before us. 2. Thiru K.V. Rajagopalan, the learned Authorised Representative alleged that both the assessing authority and the AAC confined their consideration only to the question whether the stiff collars were readymade garments or not. In pre-revision notice ....
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....e circumstances he contended that it was not correct to deny the connection to which it was entitled to. He contended that even pillows, quilt, beds etc. were specifically exempted by the order annexed to this notification. Stiff collars, after all, form part of a readymade garment and it will be unreasonable to claim that is not made of cotton when the shift which ultimately contains the collar is rightly acknowledged as a readymade garment made of cloth. As regards the Board's clarification in B.P. Rt. 589 dt. 13th Feb., 1975 it was stated that the clarification was not issued on the basis of any study of the materials. The appellant complied to the Board against the action of the revising authority, but got a letter supporting the assessment apparently on the view that it contained plastic goods. He contended that the clarification is not based upon any proper study of the material and that at any rate it cannot be binding before the date of such clarification. He argued that the appellant had always been allowed this concession and that the other dealers in this line have also been given such concession. 3. Thiru J. Venugopal, the learned State Representative on the other hand....
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....ipoint rate, the appellant had not made the alternative claim for concessional rate. 4. We have carefully considered the records as well as the arguments. We have seen a specimen of the stiff collar and have taken the various pieces apart. We find that a stiff collar is made of many pieces. Outer layer is of starched long-cloth. The inner layer is cut into pattern from processed material made of buckram cloth attached to a polythene band. There are similar processed pieces at two corners. Two plastic "bones" (clips) are placed at the two corners to lend support to the stiffness. The entire purpose is to stiffen the collar so that it retains its shape curing wear. This is achieved by attaching the polythene bands to the buckram cloth (by a process of machine-pressing) forming the inter layer as the main material Notwithstanding the polythene bands found in the inner layer and the two corners as well as the two small plastic pieces serving as "bones" we have no doubt that the article is substantially made of cloth. The layers excepting the polythene bands, including the buckram cloth corners are all cloth. The learned State Representative weakly tried to suggest that buckram cloth m....