TaxTMI 
TaxTMI 
2013 (10) TMI 395
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.... a conclusion that woolen carpet yarn is exempted from tax?" In the first revision petition bearing S.B. Sales Tax Revision Petition No.21 of 2005, the impugned order of the learned Tax Board pertains to the assessment year 1995-96 whereas in two other connected revision petitions, the order of assessment is of assessment year 1996-97. Taking into account the fact that common question of law is involved in all these revision petitions, for the sake of convenience, the factual matrix giving rise to all these cases, as alleged in S.B. Sales Tax Revision No.21 of 2005, are set out hereinafter. Succinctly stated, the facts of the case are that the respondent-assessee is a manufacturer of carpet woolen yarn and for the assessment year 1995-96 it has submitted four quarterly returns showing total sale of Rs.2,95,77,801.85. As per the Revenue, the assessee deposited a deficit tax for a sum of Rs.68,895/-, for which the assessee has claimed 4% set off of the tax on the anvil that woolen carpet yarn is a raw wool, which is exempted from tax by virtue of Notification dated 13th of June 1994 issued by the Government under Section 4(2) of the Rajasthan Sales Tax Act, 1954 as well as Notifica....
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....7 is not applicable for allowing set off of 4% tax to the assessee. Per contra, Mr. Varun Singhvi for Mr. Dinesh Mehta, learned counsel for the respondent-assessee, has vehemently argued that woolen yarn and woolen carpet yarn are raw wool and as such 4% exemption of set off on the tax allowed by the learned Tax Board is a just decision, which is in consonance and in conformity with the Notification dated 13th of June 1994. Mr. Singhvi has argued with full eloquence that wool carpet yarn is a subcategory of the wool yarn, and therefore, the product manufactured by the assessee is covered within the four corners of Notification dated 13th of June 1994. Mr. Singhvi submits that there is nothing on record to show that these are two different products and as such the conclusions drawn by the learned Tax Board that both these products fall within the ambit of raw wool cannot be faulted. Supporting the verdict of the learned Tax Board, Mr. Singhvi would urge that the learned Tax Board has rightly construed the Notification dated 20th of March 1997 to the advantage of assessee and the argument of the learned counsel for the Revenue in this behalf are merely ceremonious without any substa....
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.... of any goods or class of goods, or any person or class of persons for expediency or in the public interest. At the threshold, the State Government issued Notification dated 27th of June 1990 while exercising powers under Section 4(2) of the Rajasthan Sales Tax Act, 1954, which is pari materia to Section 15 of the Act of 1994, granting exemption from tax, sale or purchase of raw wool to the extent to which the rate of tax in respect thereof exists 1.5 per cent on certain terms. The said Notification was further followed by yet another Notification on 13th of June 1994, whereby exemption from tax on sale or purchase of any raw wool was envisaged on certain conditions. In the Notification dated 13th of June 1994, Clause (1) reads as under: (1) That such raw wool is used as raw material in the manufacture of woolen yarn within the State of Rajasthan The Notification dated 13th of June 1994 was further followed by Notification dated 20th of March 1997, which was issued under Section 15 of the Act of 1994. The complete text of Notification is reproduced as infra: S.No.1100:F.4(1)FD/TaxDivn/97-133 dt 20.3.1997 S.O.345.- In exercise of the powers conferred by S.15, RST Act, 1994, the ....
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....ics will be classified as being either woolen or worsted, but this designation is assigned during fibre processing and yarn formation, not in the cloth or finished garment. Under the Act of 1994, the word "yarn" has not been defined and both the words; namely, "woolen yarn" and "woolen carpet yarn" are also not defined and explained in the notifications dated 13th of March 1994 and 20th of July 1997. "Yarn" means any fibre, or wool, silk, flax, cotton nylon etc. spun into strands for weaving, knitting or making thread. The fibre, in order to answer the description of yarn, must have two characteristics, firstly, it should be a spun stand and secondly, such strand should be primarily meant for use in weaving, knitting, or rope making. The term "raw material" is defined under subsection (34) of Section 2 of the Act of 1994, which reads as under: (34) "raw material" means goods used as an ingredient in the manufacture of other goods and includes preservative, fuel and lubricant required for the process of manufacture. Learned counsel appearing for the petitioner Revenue has not been able to explain the term "woolen carpet yarn", and on the other hand the learned counsel for the re....