2016 (12) TMI 1740

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....s liable for a rate of 6%, whereas the claim of Revenue has been that it falls under a generic entry "preserved food articles", and was liable to be taxed @ 12%. The Assessing Officer, analysing the material on record and after taking into consideration the nutritional information on the packing of the aforesaid products that the same is mixed with preservatives, salt, spices, edible oil and nitrogen, is put in a packet to retain the freshness, was of the prima facie view that the three items would fall in entry no. 156, which comes under the residuary entry, liable to be taxed @ 12%, issued a show cause notice. 2.1 The petitioner furnished a detailed reply to the show cause notice contending that it is a plain and simple namkin and would fall under entry no.78, known as "Deshi sweetmeats, kulfi, ice-cream and namkins", and could not be considered under the general category, liable to be taxed @ 12% and objected to the said proposition. However, the AO was not satisfied and levied tax @ 12% under general category of "Preserved Food Articles". 3. The assessment order was challenged by the petitioner in this court by filing S.B. CIVIL Writ Petitions for all the three years and this....

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.... assessment was made in the case of Uncle Chips Co. Ltd. by the Revenue which was challenged by Uncle Chips before the appellate authorities. Though the Tax Board decided in favour of the Revenue but in the case of Uncle Chips final assessment was made accepting the contention of that assessee, that the product falls in the category of namkin and a revision petition was filed by M/s. Uncle Chips Company Limited v. ACTO [STR 48/2005] in the light of changed scenario to grant refund of differential tax and this court vide order dt 13.12.2006 took into consideration the aforesaid fact and directed the Revenue to refund the excess amount collected within a period of two months, and thus contended that when identical issue has been accepted by the Revenue and it having become final, the claim of assessee is well justified. Learned counsel also contended that the Revenue cannot travel beyond the show cause notice which was issued on the basis of the order passed by the Tax Board in the case of ACTO v. M/s. Uncle Chips Company Limited [Appeal No.428/2004/Jaipur, decided on 18.1.2005] and once the Uncle Chips judgment has already been accepted by the Revenue, the very foundation falls. 4.....

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....claim of M/s. Uncle Chips in a summary and cryptic manner. Learned counsel strongly relied upon the judgments in the case of State of Tamil Nadu v. Pyare Lal Malhotra & Ors (1976) 1 SCC 834, M/s. Pappu Sweets and Biscuits v. Commissioner of Trade Tax U.P. Lucknow (1998) 7 SCC 228, RayBan Sun Optics India Ltd. v. Dy. Commissioner (Appeals) and others [STR 78/2012, decided 15.10.2013], which have a material bearing on identical issue answered by the apex court, and accordingly contended that this being a concurrent finding of fact recorded by all the authorities in unison, the question of law formulated by this court is required to be answered against the assessee and in favour of the Revenue. 6. I have considered the arguments advanced by the learned counsel for the parties and have perused the material on record including the judgments minutely. 7. The substantial question of law admitted by this court is as under :- "Whether product of the appellant-company viz. 'kurkure', 'potato chips' and 'cheetos' fall in the category of Entry 78 of Notification dated 25.10.2000 and does not come within the ambit of Entry 150 of the said Notification." 8. Though le....

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.... of assessee, will immediately provide "bikaneri bhujia, chana dal, chewra" etc. and only if one specifically asks for "potato chips, kurkure and cheetos" etc., then the shopkeeper may give such items otherwise the product of namkin like sev, bikaneri bhujia, mogar etc. would immediately be given by the shopkeeper. Even normal ordinary meaning of namkin in my view is bikaneri bhujia, chana dal, chewra or a similar product. 12. In my view, potato chips, kurkure and cheetos can clearly be said to be "food articles" and though may be that it may taste like a namkin, but cannot really be said to be pure and simple namkin, it can only be classified to be falling in the category of "food articles". 13. As admitted by learned counsel for the petitioner that nitrogen is added, and once nitrogen is added may be for any reason or to preserve the product, in my view it can certainly be held to be falling in the general/residuary category. 14. The State Government taking into consideration this fact which has been argued by the learned counsel for the petitioner, though from 31.3.2006 as per Notification S.O. 458 dt 31.3.2006 has introduced entry 131 included dried potato chips, would essen....