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TMI Blog2013 (11) TMI 909X X X X Extracts X X X X X X X X Extracts X X X X ..... in holding that the Zarda/ Yukta, Pan Masala is not a tobacco preparation within the meaning of item No.2 of XIth schedule of the I.T. Act. 2. Whether in the facts and in the circumstances of the case the Hon'ble ITAT Allahabad has misdirected itself in holding that the ratio decidendi of the decision rendered by the Hon'ble Supreme Court of Inida in the case of Radhey Shyam, Gudakhu Factory State of Orissa, does not apply to the present time. 3. Whether on the facts and in the circumstances of the case, the Hon'ble ITAT has miscarried the facts of Radhey Shyam Gadakhu Factory Vs. State of Orissa and thereby erred grievously in not appreciating the true import and meaning of the test of essential and effective ingredient" as evolved by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... whether the Tribunal was justified in holding that Zarda Yukta Pan Masala is not tobacco preparation within the meaning of Item No.2 of Schedule XI of the Act and whether the assessee is entitled for deduction under Section 80I and under Section 32AB was considered and the reference application arising out of the order passed by the Income Tax Appellate Tribunal holding that Zarda Yukta Pan Masala is not tobacco and the assessee was entitled for deduction under Section 80I and 32AB was rejected on the ground that the findings of the Tribunal are findings of fact giving rise to no referable question of law. Against the order dated 19.8.1992 the CIT (Central), Kanpur filed ITA No.39 of 1992, which was also rejected on 18.7.1995. The Commissio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icles other than articles or thing in the Schedule XI and which includes in Entry-2; 'tobacco and tobacco preparations, such as cigars and cheroots, cigarettes, biries, smoking mixtures or pipes and cigarettes, chewing tobacco and snuff'. Pan Masala is not a mixture of tobacco but when it is mixed with tobacco, it becomes a tobacco preparation. In State of Orissa v. Radheshyam Gudakhu Factory (Supra), the Supreme Court held that 'gudakhu' is product of tobacco, and that although a major part of molasses and other constituents are added to the tobacco the essential and effective ingredient remains tobacco, and therefore 'gudakhu' is known as a product of tobacco in common parlance. The Supreme Court upholding the order of the High Court in w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not complete the list of tobacco preparations. For example cigarettes, biries and smoking mixtures for pipes and cigarettes, chewing tobacco and snuff are also tobacco preparations and not tobacco by itself. A variety of ingredients can be mixed together to form a tobacco preparations. The object of entry, is apparently to exclude rebates on manufacture of products, which are dangerous to health. 20. In J.K. Synthetics Ltd. v. Commissioner of Income-Tax, Kanpur, 1981 (130) ITR 23 (SC) The Supreme Court was of the opinion that the question as to whether Nylon-6 is petro-chemical is a question of fact and not a question of law. In a said case the Tribunal held that Nylon-6 is petro-chemical within the meaning of Entry 18 of 5th Schedule to t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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