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TMI Blog2005 (10) TMI 504X X X X Extracts X X X X X X X X Extracts X X X X ..... ribunal was legally justified to hold that no tax is payable on sale of used filter cloth and polypropylene cloth despite the fact that the aforesaid commodities are taxable vide Notification No. ST-II-5785 dated September 7, 1981 as old, discarded, unserviceable or obsolete machinery, stores or vehicles including waste products except cinder, coal ash and such items as are included in any other notification issued under the Act at eight per cent? (ii) Whether the Sales Tax Tribunal was legally justified to set aside the tax imposed on pouching charges despite the fact section 2(h) of the U.P. Sales Tax Act indicates? (iii) Whether the Sales Tax Tribunal was legally justified to declare nontaxable, sale of gunny bags despite the fact th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r are also exempted. To the same effect there are other judgments such as Bajpur Co-operative Sugar Factory Ltd. v. Commissioner of Trade Tax [2001] 31 STR 66 and Chhata Sugar Co. Ltd. v. Commissioner, Trade Tax [2001] 124 STC 33 (All); [2001] 34 STR 484. In view of these decisions it is held that the Tribunal was legally justified to hold that the sales of gunny bags are non-taxable. Question No. 3 is decided accordingly. So far as question No. 4 is concerned, it is concluded by a decision of this court in the case of Commissioner of Trade Tax v. U.P. Straw and Agro Product Ltd., Moradabad [2004] UPTC 1125. It has been held by a learned single Judge of this court that rice husk and paddy husk are two different commodities. The paddy husk ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment of tax in view of notification issued under section 4 of the Act. The said cloth has been used in the plant as filter to filter the sugarcane juice. It was purchased as cloth within the State of U.P. on which the additional excise duty has been paid and it is used to filter the sugarcane juice in the manufacturing process of sugar. Such cloth is used only once and thereafter it is sold. The assessing authority taxed the sale of such cloth treating it as old, discarded, unserviceable or obsolete machinery under the notification dated September 7, 1981. The Tribunal has found that since these clothes were usable, therefore, this cannot be treated as old or discarded machinery. No contrary evidence or material could be placed by the depar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of tax on pouches mainly on the ground that the sale of country liquor is exempt and, therefore, its container, namely, pouches is also exempt. The learned counsel for the dealer/opposite party has relied upon a circular dated August 12, 1999 issued by the Commissioner of Trade Tax in consultation with the Law Department of State Government. The law Department opined that in view of addition of section 3-AB to the Act, it is clear that the packing material could be liable to be taxed at the rate at which the goods packed therein is taxable. In view of the circular issued by the Commissioner of Trade Tax, which is in accordance with the law department, it is not open to the department to contend that the pouches are liable to be taxed und ..... X X X X Extracts X X X X X X X X Extracts X X X X
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