2001 (10) TMI 1118 - HC - VAT and Sales Tax

Summary

Issues:
Assessment of tax on the sale of pickles under entry 75 of the Kerala General Sales Tax Act, 1963 - Whether pickles are assessable as food sold in air-tight containers or at the general rate of 5 per cent.

Analysis:

Issue 1: Assessment of tax on the sale of pickles under entry 75

The assessee, a pickle manufacturer, contested the assessment of tax at 10 per cent on the sale of pickles under entry 75 of the First Schedule to the Kerala General Sales Tax Act, 1963. The contention was that pickles do not fall under the category of food sold in air-tight containers as per the said entry. The first appellate authority, after physical verification, confirmed that pickles were not sold in air-tight containers. However, the Sales Tax Appellate Tribunal reversed this decision, stating that pickles are assessable under entry 75. The High Court noted that the preservation of pickles is achieved through ingredients like oil, preservatives, and salt, not air-tight sealing. The Court highlighted that pickles were classified under a different entry, not as food sold in air-tight containers, indicating legislative intent. The Court concluded that since pickles were not sold in air-tight containers, they should be taxed at the general rate of 5 per cent, overturning the Tribunal's decision.

In conclusion, the High Court allowed the revision filed by the assessee, setting aside the Tribunal's order and determining that pickles should be assessed at the general rate of 5 per cent, not under entry 75 of the First Schedule to the Act.