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2001 DIGILAW 606 (KER)

Bymore Food Products v. State of Kerala

2001-10-30

C.N.RAMACHANDRAN NAIR, P.K.BALASUBRAMANYAN

body2001
Judgment :- CN. Ramachandran Nair, J. This Tax Revision Case is filed by the assessee, wllich is a manufacturer of pickles. In the assessment for the year 1991-92 the assessing officer levied tax at 10 per cent on the sale of pickles treating it as an item falling under Entry 75 to the. First Schedule of the Kerala General Sales Tax Act, which provides for levy of tax on food sold in air tight containers. The assessee's contention is that pickle is neither a food item nor sold in air tight containers, and therefore is not assessable under Entry 75 to the First Schedule of the Act. Since the entry for pickle was brought under the First Schedule to the Act only from 1992-93 onwards, the assessee's claim is that tax could be levied only at the general rate of 5 per cent. 2. Following his earlier order, and after physically verifying and satisfying that pickle is not sold in air tight containers, the first appellate authority allowed the appeal. On further appeal by the State, the Sales Tax Appellate Tribunal allowed the State appeal and restored the order of assessment holding that pickle is assessable under Entry 75 providing for food sold in air tight containers taxable at 10 per cent. This revision is filed by the assessee against the Order of the Sales Tax Appellate Tribunal. 3. We have heard counsel for the assessee and the Government Pleader. 4. At the time of hearing, counsel for the assessee pointed out that the assessee is a small-scale industrial unit which does manual packing of pickle in glass bottles. According to counsel, the packing is not with any mechanical assistance and the packing is not air tight as the same is not possible manually. The further contention of the assessee is that pickle is preserved by use of ingredients such as sodium bensite, gingelly oil and salt, and the finding of the Tribunal that preservation is achieved by air tight packing is not correct. 5. We feel that the assessee's contention is tenable and there is also a finding by the first appellate authority, who has examined the pickle in container produced by the assessee and a sample taken by him from the market, that pickle is not packed in air tight containers. 5. We feel that the assessee's contention is tenable and there is also a finding by the first appellate authority, who has examined the pickle in container produced by the assessee and a sample taken by him from the market, that pickle is not packed in air tight containers. Further, it is common knowledge that preservation of pickle is achieved by using medium of oil, use of preservatives and salt. Normally food is packed i8;1 air tight containers to preserve it from bacteria attack, and in fact after packing, the item is normally sterilised. The Tribunal's observation that packing in air tight containers involves removal of entire air in the container by a mechanical process and simultaneous sealing does not appear to be correct. A packing which involves removal of entire air is normally known as vaccum packing, leaving no DLU inside, whereas air tight container only means prevention of entry of air from outside. In any case, since there is a clear finding that pickle is preserved not by air tight packing, but by use of preservatives, medium oil and salt, and that there is no airtight sealing of the pickle is involved, we find that the Order of the Tribunal is not sustainable. With regard to classification of pickle also, we find that when pickle was introduced in the First Schedule, to the Act, it was not brought under Entry 75 along with food sold in air tight containers, but it is brought along with chilly powder, coriander powder, under Entry 32 taxable at 6 per cent. Therefore the Legislature does not appear to have intended to treat pickle under food at any time. In fact food in the normal connotation means something take into .the system to maintain life and growth and to supply nourishment see State of Tamil Nadu v. K.S.M.G. Meenambal, (1983) 56 STC 82. However, we do not think it necessary to decide that question because of our finding that pickle is not sold in air tight containers to fall under Entry 75. Therefore we are of the view that pickle was assessable during the year 1991-92 at the general rate and not under Entry 75 of the First Schedule to the Act, as held by the Tribunal. We set aside the Order of the Tribunal and allow this Revision filed by the assessee.