Madras High Court
M/S.Aalayam Traders vs The on 10 July, 2019
Author: Vineet Kothari
Bench: Vineet Kothari, C.V.Karthikeyan
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Judgment dated 10.07.2019 in
M/s.Aalayam Traders vs The
Appellate Assistant Commissioner (CT)
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 09.07.2019
CORAM
THE HONOURABLE DR. JUSTICE VINEET KOTHARI
and
THE HONOURABLE MR.JUSTICE C.V.KARTHIKEYAN
Tax Case (Revision) Nos.143 to 145 OF 2018
and
CMP Nos.19438, 19444 and 19447 of 2018
M/s.Aalayam Traders,
No.3, Veeraiah Street,
Kundupalayam,
Puducherry 605 009. ..Petitioner
in all cases
Vs
The Appellate Assistant Commissioner (CT),
Commercial Taxes Department,
Puducherry. ..Respondent
in all cases
Common Prayer: Revisions filed under Puducherry VAT Act 2007 to revise
the order of the Puducherry Value Added Tax Appellate Tribunal, Puducherry
in T.A.Nos.36, 35 and 37 of 2017 respectively dated 07.06.2018.
For Petitioner
in all cases :Mrs.Hema Muralikrishnan
For Respondents :Mrs.N.Mala
in all cases Additional Government Pleader (Pondy)
http://www.judis.nic.in
2/22
Judgment dated 10.07.2019 in
M/s.Aalayam Traders vs The
Appellate Assistant Commissioner (CT)
COMMON JUDGMENT
[Judgment of the Court was delivered by DR.VINEET KOTHARI, J.] The Assessee has filed the present Revision Petitions aggrieved by the common order passed by the Sales Tax Appellate Tribunal at Puducherry, dismissing the appeals filed by the Assessee and holding that the commodities in question viz., Lays, Kurkure, Cheetos, Quaker Oats were taxable in the residual entry under the provisions of Pondicherry Value Added Tax Act, 2007.
2. The observations of the learned Tribunal in the impugned order containing the alleged reasons for so holding, are also quoted below for ready reference:
"11. As far as the revision is concerned, the Authority below has power under Section 30(2) of PVAT Act, 2007 and thereby notice was issued for wrongful classification made by the appellant regarding sale of packaged commodities as mentioned above as savories and assessed the applicable rate of tax 2% instead of 14.5%. Thereafter, the Assessing Authority issued notice by exercising power as conferred u/s 30(2) of PVAT Act, 2007 and thereby the Assessing Authority assessed Tax at 14.5% on the sale of packaged commodity known as Lays, Kurkure and Cheetos and levied tax @ 14.5% on the reported http://www.judis.nic.in 3/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) turn over for the years 2015-2016 and 2014-2015 respectively. The Learned Counsel for the appellant has submitted the citations-
1.DCAITST Vs. Dhanalakshmi Vilas Cashew Co.- (1969) 24 STC 491.
2.Binani Industries Ltd. Vs. Assistant Commissioner
- (2007) 6 VST 783.
3.CIT Vs. J.K.Commercial Corporation - (1976) 105 ITR 219
4.Marimuthu Nadar and Brothers Vs. State of Tamil Nadu - (1981) 47 STC 314.
5.State of Tamil Nadu Vs. Mohamed Hanifa - (1992) 87 STC 240.
On careful reading of those judgments they reveal that they are relating to the reopening of assessment, in the case on hand, the Learned Counsel for the appellant has argued that the Assessing Authority has not acted in accordance with law and reopening the assessment and the returns submitted by the dealer along with the tax have to be accepted as self attested, but the authority below failed to accept it. On careful reading of Section 24(2) of PVAT Act, 2007, proviso (a), (b) and (c) clearly shows that the Assessing Authority may select either at his discretion or as directed by the Commissioner any dealer for detailed assessment for a year by scrutiny of accounts and may make best judgment assessment if so required. Further http://www.judis.nic.in 4/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) according to Section 30 of the PVAT Act, 2007, the Assessing Authority can determine to the best of its judgment the turnover which has escaped assessment and also the tax payable on such turn over. In the case on hand, according to the respondent, the appellant had wrongly classified and thereby the authority below had re-assessed the tax according to law. Therefore the said case laws will not be applicable to the present facts of the case and the contention of the appellant to that regard is not acceptable.
12. As far as the savories is concerned, the G.O. has been issued for all the cooked food items including sweets and savories. Therefore, the intention is that savories and sweets served along with the cooked foods in hotels, restaurants and other eatable places only covered under the G.O. and it will not be applicable to the packed items which are all not served along with cooked foods. The G.O. has specifically coined the word "all kinds of cooked food, including sweets, savories". If the intention is to reduce all the sweets and savories and packed items, the G.O. could contain the words "all the cooked foods, sweets and savories". The word used as "including sweets and savories" and thereby the intention is for the sweets and savories supplied along with cooked food. The Learned Counsel for the appellant has submitted the authorities stating that Kurkure, Lays and Cheetos are savories and taxable at 2% as per the G.O.Ms.No.24/F2/2013, dated 31.7.2013.
1. Pepsico India Holdings Ltd. Vs. Commissioner of http://www.judis.nic.in 5/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) Commercial Taxes, Ezhilagam, Chepauk, Chennai and others - W.A.No.551/2009-wherein the Hon'ble High Court at Madras held that the Lays and Chips are to be classifiable as processed vegetables and not comes under a residuary entry.
2. Commissioner Vs. Pepsi Foods Ltd. - (2012) 286 ELT A152(SC), wherein the Hon'ble Supreme Court held that the Cheetos Wheels and Lehar Kurkure are edible preparation and eligible for excise duty exemption.
On careful reading of those judgments submitted by the appellant, they reveal that the Lays, Kurkure and Cheetos, Wheels are processed vegetables and edible preparation and taxable as per the classification of the Act. As far as the processed vegetables are concerned, as per PVAT Act, the III Schedule Part-A, SI.No.7 "All processed fruits, vegetables, etc. including fruit jam, jelly, pickle, fruit squash, paste, fruit drunk and fruit juice (whether in sealed containers or otherwise) are taxable at 4%. But in the case on hand, the appellant is not claiming that the said Chips, Kurkure and Cheetos are liable to be taxed at 4%. Per contra they are claiming the G.O.Ms.No.24/F2/2013, dated 31.07.2013. As per the said G.O., it reduced the tax from 14.5% to 2%, for all kinds of cooked food, including sweets, savories and mineral water. Therefore, it is clear that which are all taxable at 14.5% alone reduced to 2%. In the case on hand, according to the appellants, the potato chips are processed vegetables and http://www.judis.nic.in 6/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) whileso, the tax is 4% as per the III Schedule of PVAT Act, 2007 and it will not cover under the G.O.Ms.No.24/F2/2013, dated 31.07.2013. Once the appellant relied the said G.O., he is estopped from denying its applicability. Simply we can say that as per the appellant's contention the Potato Chips i.e. Lays are the processed vegetable and they are not coming under the residuary clause but the G.O. is applicable to the goods which were already taxed at 14.5% was reduced to 2%. If it is so, the said Lays, Cheetos, Kurkure have to be taxed at earlier as 14.5% but as per the III Schedule, the processed vegetables are taxable at 4%. In the case on hand, it is not the case of the appellant that the processed vegetable taxable at 4% and they relied the G.O.Ms.No.24/F2/2013, dated 31.07.2013 and thereby the said case laws will not be applicable to the present facts of the case. The appellant has taxed the said goods at 2% by relying the said G.O.Ms.No.24/F2/2013, dated 31.07.2013. Even the potato chips are taxable at 4% as per the III Schedule, the appellant themselves admitted that the G.O.Ms.No.24/F2/2013, dated 31.07.2013 is applicable to him thereby he is not entitled to the benefits as per the III Schedule of PVAT ACT, 2007. Therefore, the Authorities submitted the appellant that Lays, Cheetos, Kurkure are savories will not be applicable to the present facts of the case. The Authority below has also clearly interpreted that the Lays, Kurkure, Cheetos are not served along with the cooked foods and they are packed commodities.
http://www.judis.nic.in 7/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT)
13. Further, as far as the Quaker Oats is concerned, as per respondent, it comes under the residual entry goods. Further, on perusal of the First Schedule, which are list of goods exempted from tax in "SI.No.45-A of PVAT Act - Ready to eat unbranded foods including sweets, savories, etc.," are exempted from tax. Therefore, from the First Schedule, it is clear that the branded foods, sweets and savories are liable to be taxed. As far as the Oats is concerned, according to the appellant, Porridge and Quaker Oats comes under the classification of Porridge. So taxable at 5%. Even according to the Schedule III Par-A, Sl.No.99 of PVAT Act, 2007, Porridge are taxable at 4%. But the appellant relied on G.O.Ms.No.24/F2/2013, dated 31.07.2013 and admitted that earlier it was taxable at 14.5% and now reduced to 2%. So, the said Quaker Oats will not cover the Porridge classification under the III Schedule of PVAT Act. If the Quaker Oats is covered as Porridge under the Schedule of PVAT Act, then why the appellant classified the said goods as taxable at 14.5% and relied the G.O.Ms.No.24/F2/2013, dated 31.07.2013. According to the III Schedule, Porridge is taxable at 4%, but in the case on hand, it is not the case of the appellant that the Quakers Oats is liable to be taxed at 4%, but relying the G.O. and claimed tax at 2%. Therefore, the contention of the appellant is not acceptable. Even the said Lays, Kurkure, Cheetos and Quaker Oats are taxable as per III Schedule, the appellant has taxed only at 2% relying the G.O.Ms.No.24/F2/2013, dated 31.07.2013 and thereby he has http://www.judis.nic.in 8/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) not come to the court with clean hands. Since the appellant has suppressed the facts and not come to this court with clean hands, he cannot seek any remedy from this court. As per the Notification, all the cooked foods including sweets and savories, means sweets and savories supplied along with the cooked foods alone liable to be taxed at 2% and the other branded sweets and savories are liable to be taxed at 14.5% as per the Schedule IV Part-A of the PVAT Act. As per the said G.O. the earlier tax at 14.5% reduced to 2%, therefore earlier the said cooked food, savories and sweets were taxed at 14.5% and they did not come in III Schedule. The appellant also agreed that the said G.O. will be applicable to this case. Therefore, the said Chips, Cheetos, Kurkure and Quaker Oats were earlier taxed at 14.5% as per the said G.O. If so, the G.O. certainly would contain the word "all savories and sweets." Per contra, the word used as "all cooked foods including savories and sweets". On careful reading of the said G.O., it reveals that cooked food includes savories and sweets and it does not include the packed branded items.
14. Therefore, as discussed above, this court is of the opinion that the grounds stated in both the memorandum of appeals are not valid grounds and the Authority below has passed the Common Order according to law and therefore, this court has no warrant to interfere with the order passed by the Authority below and accordingly, both the appeals are devoid of merits and liable to be dismissed. The Point is answered accordingly."
http://www.judis.nic.in 9/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT)
3. The relevant Notification issued on 31.07.2013 viz., G.O.Ms.No.25/F2/2013 by the Government of Puducherry and which is applicable to the assessment period in question before us, is also quoted below for ready reference to its relevant extent:
"GOVERNMENT OF PUDUCHERRY FINANCE DEPARTMENT (G.O.Ms.No.25/F2/2013, dated 31st July 2013) NOTIFICATION In exercise of the powers conferred by section 31 of the Puducherry Value Added Tax Act, 2007 (Act No.9 of 2007), the Lieutenant-Governor, Puducherry being satisfied that it is necessary so to do in the public interest, is pleased to reduce and fix the rate of tax payable in respect of the goods specified as follows, namely:-
(a) Edible oil, vegetable oil, oil cake and de-oiled cake from 5% to 1%;
(b) All kinds of cooked food, including sweets, savories and mineral water from 14.5% to 2%; "
4. The said Notification made a departure from the earlier applicable Notification, G.O.Ms No.27/F2/2007 dated 01.07.2007, in which, the relevant entry reducing the rate of tax from 12.5% to 2% applicable to http://www.judis.nic.in 10/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) such items as under:
"GOVERNMENT OF PUDUCHERRY FINANCE DEPARTMENT (G.O.Ms.No.27/F2/2013, dated 1st July 2007) NOTIFICATION In exercise of the powers conferred by section 31 of the Puducherry Value Added Tax Ordinance, 2007 (No.1 of 2007), and all other powers enabling him in this behalf, the Lieutenant- Governor, Puducherry being satisfied that it is necessary so to do in the public interest, is pleased to reduce the rate of tax payable in respect of:
(a) Liquified Petroleum Gas (LPG) from 4% to 1%;
(b) Ready to eat unbranded foods including sweets, savouries, unbranded non-alcoholic drinks, beverages and mineral water served in or catered indoors or outdoors by hotels, restaurants, sweet stalls, clubs, caterers and any other eating houses, from 12.5% to 2%;"
5.Learned counsel for the Appellant/Assessee, Mrs.Hema Muralikrishnan, submitted that the entry in the relevant Notification dated 31.07.2013, does not have any restrictions on the item sold by the Assessee in the present case, which are apparently covered by the term 'savories' in the said Notification, which by definition means, 'salty food items'. She submitted that "all kinds of cooked food including sweets", which the present http://www.judis.nic.in 11/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) items are not and "savories" were sought to be taxed at the reduced rate of 2% reducing the same from 14.5% under the provisions of the said Puducherry VAT Act, 2007. Therefore, the said Notification was issued to give the benefit of concessional rate to such items. She further urged that the Revenue on the other hand intends to impose tax on these items in the residual entry at the rate of 14.5% tax, although these commodities were well covered by the aforesaid entry in the question in the Notification dated 31.07.2013. She relied upon the decisions of the Madras High Court in the case of Pepsico India Holdings Pvt. Ltd. Vs. Commissioner of Commercial Taxes in W.A.No.551 of 2009 decided on 10.11.2009, in which, the Coordinate Bench of this Court held that the Potato Chips in the brand names of Lays and Uncle Chips were taxable at the rate of 4% as "processed vegetables" but not in the residual entry.
6. Therefore, she submitted that as an alternate contention, the Assessee in the present case also seeks to raise such a contention that in case, the court comes to the conclusion that the items in question are not taxable as "savories" in the Notification dated 31.07.2013, the same should be held to be taxable at 4% as "processed vegetables". http://www.judis.nic.in 12/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT)
7. As far as Quaker Oats are concerned, she urged the contention that the same are taxable as "Porridge" at the rate of 5% in Entry 99 of III Schedule of the said Act.
8. The said decision of the Coordinate Bench of this Court Pepsico India Holdings Pvt. Ltd.(supra), was relied upon the decision of the Gauhati High Court in the case of the same Company, Pepsico India Holdings Pvt. Ltd. Vs. State of Assam in (2009) 25 V.S.T. 41, in which, the same items Lays and uncle Chips were held to be classified under the category of "processed vegetables" and not under the residual entry.
9. On the other hand, Mrs.N.Mala, the learned Addition Government Pleader appearing for the Revenue, relied upon the decision of the Rajasthan High Court in the case of Pepsico India Holdings Private Ltd., Vs. CTO, in which, the learned Single Judge of Rajasthan High Court held that the items like Potato Chips, Kurkure, Cheetos, (Masala Balls) and other flavours were not taxable as 'Namkins' but were taxable at 12% as 'preserved food articles' under the provisions of Rajasthan VAT Act. The reasoning given by the learned Single Judge of Rajasthan High Court is quoted below for ready reference:
http://www.judis.nic.in 13/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) "19. In my view, cases decided under Excise law are on a different footing and only some support can be derived but ultimately the entries given under Sales Tax/Commercial/VAT laws, stand on altogether different footings and have to be considered according to such laws.
20. The judgments relied upon by the learned counsel for the petitioner are primarily decided on the basis of Excise Laws and taking into consideration the above findings, in my view, can be said to be distinguishable and not applicable on facts. One has to take into consideration the plain and simple meaning of "Namkin" and when taken into consideration the products manufactured, can be held to be classifiable only under "preserved food articles".
21.Taking into consideration the over-all facts noticed by both the authorities and the view analysed hereinabove, in my view the question of law is required to be answered against the assessee and in favour of the Revenue. Consequently, the petitions being devoid of merits, stand dismissed, with no order as to costs."
10. Learned counsel for the Revenue also relied upon the order of Advance Ruling Authority, Commercial Taxes Department, Puducherry, rendered on 26.09.2013, which by a short order, held that 'Lion Oats' is not specified anywhere in the Schedules of Pondichery VAT Act, 2007 and hence, it is taxable at 12.5% upto 31.12.2011 and thereafter at 14.5% as http://www.judis.nic.in 14/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) per Part A of IV Schedule (residual entry) of Pondicherry VAT Act, 2007.
11.Therefore, the learned counsel for the Revenue urged that even going by the common parlance test, the Potato Chips sold in Restaurants or Shops, will have a limited shelf life as against the branded Potato Chips like Lays in question sold by the Petitioner/Assessee, which themselves claim to have a long shelf life of about six months and therefore, they cannot be included in the category of items taxable at concessional rate of 2% in the Notification dated 31.07.2013 and the Revenue Authorities are also bound by the Advance Ruling of the Authority of the Department, as far as Quaker Oats are concerned, they were taxable at 14.5% in the residual category.
12.We have heard the learned counsels at length and perused the materials available on record.
13.It is undoubted and as rightly referred and relied upon by the Coordinate Bench of Madras High Court in the case of Pepsico (supra) that in order to decide the questions like the one involved in the present case, the rule of interpretation is to adopt the common parlance test and the resort to residual entry cannot be made, unless by no conceivable process of http://www.judis.nic.in 15/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) reasoning, the commodities in question can be brought under any of the tariff items specified in the relevant Notification. The Coordinate Bench of this Court relied upon two decisions of the Hon'ble Supreme Court in the case of Bharat Forge & Press Industries (P) Ltd. vs Collector of Central Excise, 1990 (45) E.L.T. 525 (SC) and Mauri Yeast India Pvt. Limited vs. State of Uttar Pradesh, (2008) 5 SCC 680.
14. As far as the settled legal position about invoking the residual entry and common parlance test is concerned, not much of the serious debate is now left to be decided and the above two yardsticks for interpreting the relevant Notification are now well settled viz., to apply common parlance test and the resort to residual entry only if it is not possible to bring the commodity in question in the specified entry. The Special Entry like the Special Law overrides the General Entry or the General Law. "Generalia Specialibus Non Derogant", is a settled maxim for interpretation.
15. As far as the commodity in questions are concerned, viz.Potato Chips in the brand name of Lays or Cheetos, Salty Balls or Kurkure is concerned, we do not find any reasonable argument on the anvil of common http://www.judis.nic.in 16/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) parlance test from the side of the Revenue that these items cannot fall within the generic term 'savories' as used in the Notification dated 31.07.2013. 'Savories' to a common man would mean only cooked or fried food items with a salted test as against the sweet taste. The sweet taste has been separately indicated in the same Notification. In fact, there is no restriction to cover these items, as "all kinds of cooked food" in the same Notification dated 31.07.2013.
16. Be that as it may, since "savories" is separately indicated, as a generic term in the same Notification, which in our opinion would cover the items taxable in the hand of the Appellant/Assessee, without any iota of doubt, we cannot permit the Revenue to tax the same in the residual entry at much higher rate of 14.5%. That would defeat, in our opinion, the very purpose of extending the benefit of concessional rate of tax to "savories" besides all kinds of cooked food, sweets and mineral water. Therefore, the Brand or shelf life or addition of preservative or absence thereof is neither indicated nor is otherwise relevant, while interpreting the aforesaid Entry of the said Notification in hand.
http://www.judis.nic.in 17/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT)
17. What a common man will understand as a salty food item would be a savory and therefore, in the absence of the legislature make any such distinction about their Brand, Shelf life or additions of preservative or not, the Court cannot read in between the lines and uphold such a contention on behalf of the Revenue. We are not inclined to view these items away from the realm and coverage of the Notification dated 31.07.2013 and hold them to be taxable even as "processed vegetables". Merely because the potato is a vegetable and takes a different shape by roasting or frying in the form of Chips or Salty Balls and it may, by some reasoning, can be held to be even "preserved vegetable" also, but nonetheless if it can be construed as an item of 'savory' in a more beneficial Notification to the Assessee like the one in hand before us of 31.07.2013, the same need not be taxed at the higher rate of 5% as "processed vegetables".
18. It is again another well settled principle of interpretation that if there are two views possible, then the one which favours the subject or the Assessee deserves to be taken in preference. Since we are of the considered opinion that the items in hands can be included in the generic term of "Savories" in the Notification dated 31.07.2013, we do not find any http://www.judis.nic.in 18/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) reason to hold its taxability at the rate of 5% as "processed vegetables" and by no plausible reasoning, tax them in the residual entry, as contended by the Revenue.
19. The reliance placed by the learned counsel for the Revenue on the Advance Ruling Committee of the three Senior Officials of the Departmental also deserves a mention. The said order is extensively quoted below:
"GOVERNMENT OF PUDUCHERRY COMMERCIAL TAXES DEPARTMENT PROCEEDINGS OF THE AUTHORITY FOR CLARIFICATIONS AND ADVANCE RULINGS STATION : Puducherry PRESENT : Thiru K.Sridhar, M.Com., B.L., Chairman Thiru D.Mohana Kumar, Member Secretary Thiru K.Kabalan, Member
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No.25/AR/CTD/2013/522 date:26-09-2013 Sub: CTD - PVAT Act, 2007 - Authority for Clarification and Advance Ruling - Orders issued - Reg. Ref.: Application in Form-ZZ dt.nil submitted by Tvl. Sri Balaji Agencies, Puducherry.
*** "Tvl.Sri Balaji Agencies, Puducherry vide Form ZZ cited, sought for clarification and advance ruling on the on the rate of tax for Oats.
http://www.judis.nic.in 19/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT)
2. The sitting of the Authority was convened on 26.09.2013 at 10.00 A.M., in the chamber of the Chairman. Tvl. Sri Balaji Agencies, Puducherry was issued notice dated 17.09.2013, to appear before the Authority for hearing, either in person or through authorised representative on the said date and time. But the applicant has neither appeared in person nor through duly authorised representative or sought for time.
3. Therefore, the Authority has examined the clarifications sought for by Tvl. Sri Balaji Agencies, Puducherry and gives the following rulings by virtue of the powers conferred under section 77 of the Puducherry Value Added Tax Act, 2007:-
"Lion Oats is not specified anywhere in the schedules of the Puducherry Value Added Tax Act, 2007. Hence, the above item is taxable at 12.5% upto 31.12.2011 and thereafter at 14.5% as per entry no.1 of Part-A of the Fourth Schedule of the Puducherry Value Added Tax Act, 2007."
20. A base perusal of the said order would indicate a total non
-application of mind on the part of the responsible officers of the Department. Not a single reason has been assigned by them to hold the items in question as taxable at 12.5% / 14.5% and why it could not be taken as "Porridge" or as any other item like cooked food or Savories. Nothing has been decided. It appears that the said order was passed exparte http://www.judis.nic.in 20/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) without hearing the contentions on behalf of the Assessee at all. Such Advance Ruling by the responsible officials of the Department, do not inspire any confidence and therefore, it cannot be allowed to be followed by the lower Revenue Authorities throughout the State. We deprecate the tendency of passing such cryptic orders without any discussions and reasons. Such order deserves to be quashed out of hand and therefore, we quash the said order.
21. As far as the item of Oats sold under the branded name Quakers Oats are concerned, we are also inclined to uphold and accept the contention of the learned counsel for the Assessee that the said items also deserve to be taxed item as "Porridge".
22. Again, We refer the meaning of Porridge, as given in the Oxford Dictionary, which is quoted below:
"Porridge - a soft, thick white food that is made from a type of grain (oats) boiled with milk or water and eaten hot."
23. By the above Dictionary meaning and common parlance test, again there is no iota of doubt that all broken grains or cereals including oats, http://www.judis.nic.in 21/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) when cooked with water or milk will result in a food item, which can be described as "Porridge". It is on the breakfast table for most of us. So, "Porridge" may be made of different grains and oats amongst them being one which in the present case, has been sold under the brand name of Quaker and the same cannot be ruled out of the definition of "Porridge", so as to fall in the Entry 99 of III Schedule of the taxable at 5% . Again, the contention of the learned counsel for the Revenue that it is to be taxed in the residual entry is devoid of any merit, as already stated above.
24. Therefore, we are inclined to allow the present revision petitions filed by the Assesssee and hold that the items in question viz., Potato Chips, Salted in the brand name of Lays, Salty Kurkure and Cheetos are taxable as 'Savories' at the rate of 2 % in the Notification dated 31.07.2013 and 'Quaker Oats' are taxable at 5 % as 'Porridge'.
25.Accordingly, the common order passed by the Tribunal is set aside and these Tax Revision Petitions filed by the Assessee are allowed by remitting the case to the Assessing Officer. The Assessing Officer will pass fresh orders in accordance with the above judgment and refund of excess tax collected from the Assessee will be made with interest within a period of http://www.judis.nic.in 22/22 Judgment dated 10.07.2019 in M/s.Aalayam Traders vs The Appellate Assistant Commissioner (CT) DR.VINEET KOTHARI,J.
AND C.V.KARTHIKEYAN,J.
VRI one month from today and compliance will be reported back to this Court. The revision petitions are accordingly allowed. No costs. The connected miscellaneous petitions are closed.
(V.K,J.) (C.V.K,J.)
09.07.2019
Index :Yes/No
Note: Copy of this order shall be sent
to the General Secretary and
the concerned Officials.
vri
To
The Appellate Assistant Commissioner (CT), Commercial Taxes Department, Puducherry.
T.C.(R) Nos.143 to 145 of 2018 http://www.judis.nic.in