9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2022 (7) TMI 519 - SC - VAT and Sales TaxClassification of goods - KADIPROL - can be categorized as Poultry Feed falling under Entry 25 of Schedule I of the Gujarat Sales Tax Act or as a Drug and Medicine under Entry 26(1) of Schedule II Part A of the GST Act? - product in question was sold in a sachet/packet of 100 gm - HELD THAT - It was not meant to be given as a food to the poultry. It was required to be mixed with the feed given to the poultry/birds. It cannot be directly fed and/or given to the birds. Therefore, there is some merit in the contention of the Revenue that the impugned judgment and order does not deal with the reasoning given by the Tribunal. It merely quotes and relies upon the two decisions in the case of Glaxo Laboratories (India) Ltd. 1978 (12) TMI 164 - GUJARAT HIGH COURT and M/s. Pfizer (India) Ltd. 1991 (3) TMI 343 - GUJARAT HIGH COURT without a detailed and an indepth examination of the facts as found. Therefore, usually in the aforesaid background, the matter should be remitted to the High Court for a fresh decision. In view of the facts and as the issue in question is in the academic interest and as there is no revenue implication as there are no tax dues and therefore there is zero tax effect, the present proceedings is closed keeping the larger question on the Common Parlance Test open, to be considered in an appropriate case in a like matter. Appeal disposed off.
Issues Involved:
1. Classification of the product "KADIPROL" under the Gujarat Sales Tax Act (GST Act). 2. Whether "KADIPROL" should be categorized as "Poultry Feed" under Entry 25 of Schedule I or as "Drug and Medicine" under Entry 26(1) of Schedule II Part A of the GST Act. Issue-wise Detailed Analysis: 1. Classification of "KADIPROL" under the GST Act: The primary issue revolves around the classification of the product "KADIPROL" sold by the respondent. The High Court of Gujarat, in its judgment dated 05.07.2016, categorized "KADIPROL" as "Poultry Feed" under Entry 25 of Schedule I of the GST Act, which was contested by the State of Gujarat. The Deputy Commissioner of Sales Tax had earlier classified "KADIPROL" as "Drug and Medicine" under Entry 26(1) of Schedule II Part A of the GST Act. 2. Arguments by the State of Gujarat: The State of Gujarat argued that the High Court erred in overturning the findings of the Tribunal and the Deputy Sales Tax Commissioner. The composition of "KADIPROL" includes Emporium (Amprolium) Hydrochloride and Vitamin K3, used primarily to protect against coccidiosis and improve blood health in poultry. The State contended that the product's main purpose is medicinal, aimed at preventing disease rather than providing nutrition, and thus should be classified as "Drug and Medicine." The State cited previous judgments, including the case of State of Gujarat vs. M/s. Pfizer (India) Ltd., which held that products with medicinal properties and non-nutritional additives should not be categorized as "poultry feed." 3. Arguments by the Respondent: The respondent argued that the High Court rightly categorized "KADIPROL" as "Poultry Feed," considering the evolved concept of poultry feed, which now includes additives like vitamins and minerals essential for poultry development. The respondent emphasized that "KADIPROL" is marketed as a poultry feed supplement, not as a drug, and should be classified accordingly. The respondent also pointed out that there were no existing tax demands or assessments under the GST Act related to this issue, making the matter academic. 4. Court's Analysis and Decision: The Supreme Court acknowledged the merits in the State's argument that the High Court did not thoroughly address the Tribunal's reasoning. However, the Court noted that the issue had become academic, with no revenue implications or tax dues involved. Consequently, the Court decided not to remit the matter back to the High Court for a fresh decision. Instead, the Supreme Court closed the proceedings, leaving the larger question on the Common Parlance Test open for future consideration in similar cases. Conclusion: The appeal was disposed of, with the Supreme Court recognizing the academic nature of the issue and the absence of any revenue implications. The larger question regarding the classification of products like "KADIPROL" under the Common Parlance Test remains open for future adjudication.
|
