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1991 DIGILAW 305 (MAD)

COROMANDEL GARMENTS LTD. v. STATE OF TAMIL NADU.

1991-04-09

A.S.ANAND, RAJU

body1991
JUDGMENT Dr. A. S. Anand, C.J. - The petitioners are manufacturers and dealers in ready-made garments under the brand name registered under the Trade and Merchandise Marks Act, 1958. They reported a total and taxable turnover of Rs. 7,70,940.91 and Rs. 7,26,834.32 for the year 1977-78 under the Tamil Nadu General Sales Tax Act, 1959. The assessing authority however determined the total and taxable turnover at Rs. 8,01,077 and Rs. 7,48,193 respectively at 5 per cent. The appeal of the dealer to the Appellate Assistant Commissioner from the order of assessment and the second appeal to the Sales Tax Appellate Tribunal failed. The only issue involved in this revision is whether the ready-made garments sold by the assessee under a brand name registered under the Trade and Merchandise Marks Act, 1958, are subject to levy of sales tax at the rate of 5 per cent at single point under item 87 of the First Schedule or at the concessional rate under Notification S.R.O. No. A-1967 of 1959 as amended by Notification No. II-I, No. 5829/62 dated November 30, 1962. The assessing authority as well as the first appellate authority and the Sales Tax Appellate Tribunal came to the conclusion that the rate of tax on the sale of ready-made garments sold by the assessee under the brand name registered under the Trade and Merchandise Marks Act would be at 5 per cent under item 87 of the First Schedule. All the authorities consistently negatived the claim of the assessee that the rate of tax on the sales of ready-made garments was covered by the various notifications referred to supra issued under section 17 of the Tamil Nadu General Sales Tax Act. Learned counsel for the petitioner reiterated the submissions raised before the statutory authorities before us also and took us through the various notifications. Notification S.R.O. No. A-1967 of 1959 which came into force on the 1st day of April, 1959, reads as follows : "S.R.O. No. A-1967 of 1959. Learned counsel for the petitioner reiterated the submissions raised before the statutory authorities before us also and took us through the various notifications. Notification S.R.O. No. A-1967 of 1959 which came into force on the 1st day of April, 1959, reads as follows : "S.R.O. No. A-1967 of 1959. - In exercise of the powers conferred by section 17 of the Madras General Sales Tax Act, 1959 (Madras Act 1 of 1959), the Governor of Madras hereby reduces the rate of tax payable by a dealer under the said Act, in respect of his sales of ready-made garments and hand woven quilt beds and pillows to one per cent of his turnover, of such sales." This notification was followed by notification dated November 30, 1962, which reads as follows : "In exercise of the powers conferred by section 17 of the Madras General Sales Tax Act, 1959 (Madras Act 1 of 1959), and in supersession of the Revenue Department Notification S.R.O. No. A-1967 of 1959, dated the 28th March, 1959, published at page 490 of Part I of the Fort St. George Gazette, dated the 1st April, 1959, the Governor of Madras hereby reduces the rate of tax payable by a dealer under the said Act, in respect of his sales of ready-made goods made of cloth to one per cent of his turnover of such sales." This notification came into force on December 1, 1962. Item 87 of the First Schedule which was introduced by Act 23 of 1974 reads as follows : ------------------------------------------------------------------------------------ "Articles of ready-to-wear apparel At the point of first sale in the (known commercially as ready-made State 5 per cent multi-point garments) including undergarments and with effect from March 4, body supporting garments, sold under a 1974." brand name registered under the Trade and Merchandise Marks Act, 1958 (Central Act 43 of 1958) but excluding hosiery goods. ------------------------------------------------------------------------------------ A bare reading of the two notifications, issued under section 17 of the Tamil Nadu General Sales Tax Act would go to show that they are relatable in respect of sales of ready-made goods made of cloth other than the goods sold under any brand name. Both the notifications confine the area of operation generally to ready-made goods and do not extend to the ready-made garments sold under the brand names. Both the notifications confine the area of operation generally to ready-made goods and do not extend to the ready-made garments sold under the brand names. It appears that it was only with the intention of levying enhanced rate of tax on the sale of, ready-made garments sold under the brand names registered under the Trade and Merchandise Marks Act, 1958, that item 87 was specifically introduced by Act 23 of 1974 with effect from March 4, 1974. Since, the notifications under section 17 referred to supra relate to ready-made garments in general while the item 87 of the First Schedule deals specifically with ready-made garments sold under the brand name, the reliance on the notifications in preference to the item 87 of the First Schedule is thoroughly misplaced. Ready-made garments including undergarments and body supporting garments sold under a brand name registered under the Trade and Merchandise Marks Act, 1958, are covered by item 87 of the First Schedule and are subject to 5 per cent levy at the point of first sale in the State. It is settled law that where a commodity is covered by a specific entry in the Schedule and is included in that entry, the commodity has to be assessed under that specific entry alone and not under the general entry, as specific overrides the general. Consequently, the rate of tax as applicable to ready-made garments sold by the assessee, which was under a brand name registered under the Trade and Merchandise Marks Act, would attract tax at 5 per cent under item 87 of the First Schedule. Learned counsel for the petitioners faced with this situation, submitted, with reference to the grounds of appeal filed by the assessee before the Sales-Tax Appellate Tribunal, that since the registration certificate under the Trade and Merchandise Marks Act dated February 7, 1977, was received by the assessee only on February 28, 1978, the goods could not have been liable to tax at 5 per cent prior to February 28, 1978. We cannot agree. A reference to the order of assessment made by the Deputy Commercial Tax Officer on September 27, 1979, would show that the assessee had got its trade mark registered under the Trade and Merchandise Marks Act, 1958, with effect from May 12, 1975, vide Trade Mark Certificate No. 3052828 dated May 12, 1975. We cannot agree. A reference to the order of assessment made by the Deputy Commercial Tax Officer on September 27, 1979, would show that the assessee had got its trade mark registered under the Trade and Merchandise Marks Act, 1958, with effect from May 12, 1975, vide Trade Mark Certificate No. 3052828 dated May 12, 1975. It is, therefore, futile to contend that the trade mark certificate was received by the dealer only on February 28, 1978. May be the renewal of the certificate was received on a particular date, but that would not make any difference when even on the petitioner's own showing the registration certificate was presumably itself renewed on February 7, 1977. Thus, in view of the discussion above, we find that the order of the Tribunal does not suffer from any illegality, perversity or impropriety. No interference is called for in exercise of the revisional jurisdiction. The petition consequently fails and is dismissed. No costs. Petition dismissed.