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TMI Blog2009 (1) TMI 448X X X X Extracts X X X X X X X X Extracts X X X X ..... order of the Revisional Authority. Held that- handkerchief cannot be regarded as ‘readymade garments’ thus decision is in favour of assessee. - 65-67 of 1991 - - - Dated:- 19-1-2009 - M.M. Kumar and H.S. Bhalla, JJ. None, for the Petitioner. Ms. Sudeepti Sharma, DAG Punjab, for the Respondent. [Order per: M.M. Kumar, J.]. - The instant reference under Section 22(1) of the Punjab General Sales Tax Act, 1948 (for brevity, 'the Act') has arisen out of the order dated 29-9-1989 passed by the Sales Tax Tribunal, Punjab, Chandigarh (for brevity, 'the Tribunal') in Revision Nos. 71 to 73 of 1985-86 in respect of the assessment years 1977-78, 1978-79 and 1979-80. The Tribunal while accepting the application of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sis. Assessment in respect of the years 1977-78, 1978-79 and 1979-80 were finalised by the Assessing Authority, Jalandhar. However, the assessment orders were taken up for suo motu action on the ground that deductions regarding sale of handkerchief are not correct and handkerchiefs are not items of textile. Consequent on revisional proceedings additional demand was created vide order dated 14-2-1985 by taxing the handkerchief by treating them as not textile items. Aggrieved against the order dated 14-2-1985 the applicant approached the Tribunal. The Tribunal vide order dated 29-9-1989 upheld the order of the Revisional Authority. The argument of the learned State counsel that handkerchief is not an item of textile but it forms a part of rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the condition of previous publication. Entry 29 30 of Schedule 'B' 29. All varieties of cotton, woollen or silken textiles, including rayon, artificial silk or nylon whether manufactured by handloom or powerloom or otherwise but not including carpets, druggets, woollen dress and mono-filament niwar. 30. All varieties of textiles covered by item 29 on which knitting and embroidery work has been done. 5. A perusal of Section 6 alongwith Entry 29 and 30 would show that all varieties of cotton, woollen and silken textile including rayon, artificial silk etc. are not to attract any tax on sale. Likewise, all varieties of textile covered by Item 29 on which knitting and embroidery work has been done are also tax free as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icle can no longer retain its previous state of cloth though it is made of cloth. The Division Bench rejected the argument that any workmanship or embroidery made on a length of cloth should by reason of some labour or money being spent over the cloth, deprive the cloth of its true and existing character. However, Entry 30 of the Schedule specifically include in the list of tax free items all varieties of textiles covered by Entry 29, namely, cotton, woollen or silken textile on which knitting and embroidery work has been done. But the question then is whether it would include handkerchiefs because handkerchiefs are not subjected to any knitting and embroidery. As already observed, handkerchiefs are hemmed and, therefore, it may fall wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the learned Government Pleader that the fact that the edges of the kerchiefs have been stitched will take the article out of the scope of the entry cotton fabrics . We find that the same view has been taken by the Calcutta High Court in Delhi Cloth and General Mills Co. Ltd. v. Commercial Tax Officer, Central Section, West Bengal, with which ruling we are in respectful agreement. In view of the above, question No. 1, 3, 4 and 6 are answered in affirmative and accordingly decided in favour of the assessee-dealer. It follows that the view taken by the Tribunal is incorrect and is thus, set aside. Question No. 2 is also answered against revenue. It is held that in the facts and circumstances of the case, handkerchief cannot be regarde ..... X X X X Extracts X X X X X X X X Extracts X X X X
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