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TMI Blog2019 (5) TMI 123X X X X Extracts X X X X X X X X Extracts X X X X ..... aler in Cotton lint, vegetable seed, paddy seed and cotton seed for sowing purpose only. The Petitioner states that the seeds are treated with fungicides, insecticides and pasted with bio-polymers and that, as a result of the commercial treatment, the seeds become poisonous and cannot be used for edible purposes. In effect, according to the Petitioner, the seeds become inedible and are capable of being used only for sowing purposes by farmers. According to the Petitioner, the seeds were classified under entry 17, 18, 19 and 20 of Part-B of the Third Schedule of the Tamil Nadu General Sales Tax Act, 1959 (the TNGST Act) and the said entries read as under: 17.Bacterial culture for agricultural purpose; 18.Organic manures and green manure ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssued stating that hybrid cotton seeds are taxable at the rate of 4% under entry 6(iii) of the II Schedule to the TNGST Act and the said Clarification is impugned herein. This position was reiterated by the Commissioner of Commercial Taxes by letter dated 13.10.2005 wherein it was further stated that the usage theory cannot be invoked in entry 7 Part-B of the III Schedule. Thereafter, the assessment order dated 15.06.2006 was issued under the TNGST Act whereby tax was imposed on the basis that cotton seeds are oil seeds and, therefore, taxable under the II Schedule. The assessment order is also impugned herein. An interim stay of the impugned proceedings is in force from 27.09.2006. 3.At the hearing, the learned counsel appearing for the P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he learned counsel also referred to the Order of this Court in M/s.VEESONS ENERGY SYSTEMS (P) LTD Vs. THE COMMISSIONER OF COMMERCIAL TAXES, CHENNAI in W.P.(MD)No.5866 of 2010, wherein this Court held that the first respondent therein did not have power to suo moto issue a clarification under Section 48 A of the Tamil Nadu Value Added Tax Act, 2006. On the basis of the above Order, the learned counsel for the Petitioner submitted that Clarification No.147/2005 is liable to be quashed and that the Assessing Authority should be directed to make a fresh assessment after providing reasonable opportunity to the Petitioner. 5.In response, the learned counsel appearing for the Respondents submitted that when the III Schedule to the TNGST Act was a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner of Commercial Taxes, the First Respondent herein, has stated, in the letter dated 30.08.2005 that the request for amendment of entry 7 cannot be complied with and, in the Clarification dated 26.09.2005, that hybrid cotton seeds are taxable at the rate of 4% under entry 6(iii) of the II Schedule to the TNGST Act. The said Communication and Clarification do not contain any reasons. It also appears that proper opportunity was not provided to the Petitioner to state its case or its objections before the said Communication and Clarification were issued. Although Section 28 A of the TNGST empowers the Commissioner of Commercial Taxes to issue a clarification on the rate of tax in response to a request from a registered dealer, the said comm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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