1995 (1) TMI 340 - HC - VAT and Sales Tax

Summary

Issues:
Interpretation of entry 12 of Schedule A to the Bombay Sales Tax Act, 1959 regarding the classification of fibre glass fabrics and fibre glass sleevings for tax purposes.

Analysis:
The case involved a reference under section 61(1) of the Bombay Sales Tax Act, 1959, where the Maharashtra Sales Tax Tribunal referred a question of law regarding the taxability of fibre glass fabrics and sleevings sold by the assessee. The primary issue was whether these items fell under entry 12 of Schedule A to the Act or were taxable under the residuary entry 102 of Part II of Schedule C.

The assessee contended that the goods were man-made fabrics exempt under entry 12 of Schedule A. However, the Commissioner, relying on Explanation II to item 22 of the Central Excise Act, held that glass fabrics like fibre glass did not qualify as man-made fabrics under entry 12. The Tribunal upheld this decision, leading to the reference to the High Court.

The High Court analyzed the definitions of "man-made fabrics" under the Central Excise Act and entry 12 of Schedule A to the Bombay Sales Tax Act. It noted that the definition of man-made fabrics specifically excluded glass fabrics, which encompassed fibre glass fabrics. Therefore, the Court concluded that fibre glass fabrics and sleevings did not fall under entry 12 of Schedule A but were taxable under entry 102 of Part II of Schedule C.

Ultimately, the Court answered the question in favor of the Revenue, affirming the Tribunal's decision. No costs were awarded in the case, and the reference was answered in the affirmative.