M/S. M.P. AGENCIES versus STATE OF KERALA

M/S. M.P. AGENCIES versus STATE OF KERALA

Ujala Supreme and Ujala Stiff and Shine products are covered under HSN Code 3905 and 3204.12.94, and thus fall under entry numbers 155(8)(d) and 118(5) of the Third Schedule to the Kerala Value Added Tax Act, 2003; they do not attract the residuary entry 103. Classification must be based on HSN codes where specified, and common/commercial parlance applies only in absence of HSN. Mere dilution does not amount to manufacture; the tax rate is as stipulated by the Schedule for the relevant entries.

Parties
Appellant: M/S. M.P. Agencies; Respondent: State of Kerala
Jurisdiction
India
Judgment Date
18 March 2015
Procedural Posture
Civil Appeal / Final Judgment on Appeal
Outcome
Appeals allowed; High Court judgment and orders set aside.
Legal Topics
Classification of Goods, Levy of VAT, Interpretation of HSN Codes, Schedule Rates Under Value Added Tax Act
Taxation Commercial Classification of Goods Levy of VAT Interpretation of HSN Codes Schedule Rates Under Value Added Tax Act

Case Brief

Summary, issues, holding and outcome

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Parties

M/S. M.P. Agencies

Appellant

State of Kerala

Respondent

Procedural Posture

Civil Appeal / Final Judgment on Appeal

Legal Issues

  1. 1 Whether 'Ujala Supreme' and 'Ujala Stiff and Shine' are classifiable under specific HSN codes and entries in the Third Schedule of Kerala Value Added Tax Act, 2003 or fall under a residuary entry
  2. 2 Whether the process amounts to manufacture for VAT purposes
  3. 3 Whether common/commercial parlance applies for classification when HSN is absent

Ratio Decidendi

Ujala Supreme and Ujala Stiff and Shine products are covered under HSN Code 3905 and 3204.12.94, and thus fall under entry numbers 155(8)(d) and 118(5) of the Third Schedule to the Kerala Value Added Tax Act, 2003; they do not attract the residuary entry 103. Classification must be based on HSN codes where specified, and common/commercial parlance applies only in absence of HSN. Mere dilution does not amount to manufacture; the tax rate is as stipulated by the Schedule for the relevant entries.

Court Disposition

Appeals allowed; High Court judgment and orders set aside.

Orders

  • Impugned judgment and orders of High Court are set aside.
  • None of the assessee-appellants is entitled to refund of VAT already paid.