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2000 (4) TMI 771 - SC - VAT and Sales Tax


Issues:
1. Interpretation of the Bihar Agricultural Produce Markets Act, 1960.
2. Determining whether fruit drinks marketed under the brand names "Frooti" and "Appy" fall under the description of mango and apple specified in the Act's Schedule.
3. Analysis of the manufacturing process of the beverages "Frooti" and "Appy" to ascertain their classification under the Act.
4. Comparison with previous legal precedents to support the interpretation of "agricultural produce" under the Act.
5. Evaluation of the applicability of a previous court decision regarding processed agricultural products to the current case under the Bihar Act.

Detailed Analysis:

1. The judgment pertains to the interpretation of the Bihar Agricultural Produce Markets Act, 1960, which aims to regulate the buying and selling of agricultural produce in Bihar. The Act empowers Market Committees to levy and collect fees on specified agricultural produce bought or sold in designated market areas.

2. The central issue is whether the fruit drinks marketed as "Frooti" and "Appy" qualify as mango and apple, as specified in the Act's Schedule. The appellant company challenged a demand for market fees on these products, arguing that the beverages were distinct from the fruits themselves.

3. The appellant detailed the complex manufacturing process of "Frooti" and "Appy," emphasizing the transformation of mango pulp and apple concentrate into ready-to-serve beverages through a series of intricate steps involving processing, homogenization, pasteurization, and packaging.

4. The court analyzed the Act's language and Schedule, noting that while mango and apple were listed as agricultural produce, the Schedule also distinguished between primary produce and processed items derived from them. Drawing from a previous ruling, the court emphasized that the end products, such as "Frooti" and "Appy," no longer retained the identity of the original fruits.

5. A comparison was made with a previous court decision involving processed agricultural products to differentiate the definition of "agricultural produce" under the Uttar Pradesh Act from that under the Bihar Act. The court concluded that the products in question did not align with the Schedule's specifications, thereby invalidating the demand for market fees.

6. In conclusion, the court set aside the High Court's judgment, allowing the appellant's appeal on the grounds that the fruit drinks "Frooti" and "Appy" did not fall within the purview of agricultural produce as defined by the Bihar Agricultural Produce Markets Act, 1960. No costs were awarded in the matter.

 

 

 

 

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