IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR & THE HONOURABLE MR. JUSTICE K.SURENDRA MOHAN MONDAY, THE 30TH AUGUST 2010 / 8TH BHADRA 1932 ST.Rev..No. 21 of 2007() ------------------------ TA.649/2004 of S.T.A.T.ADDL.BENCH,ERNAKULAM .................... REVISION PETITIONER: ---------------------------------------- STATE OF KERALA, REP. BY JOINT COMMISSIONER (LAW), COMMERCIAL TAXES, ERNAKULAM. BY GOVERNMENT PLEADER SRI. MOHAMMED RAFEEQ RESPONDENT(S): --------------- UNIVERSAL GLOVES (P) LTD., KAKKANAD, ERNAKULAM DISTRICT. ADV. SRI.V.M.KURIAN FOR R1 SRI.MATHEW B. KURIAN FOR R1 SRI.K.T.THOMAS FOR R1 THIS SALES TAX REVISION HAVING BEEN FINALLY HEARD ON 30/08/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: C.R. C .N. RAMACHANDRAN NAIR, & K. SURENDRA MOHAN, JJ. -------------------------------------------- S. T. Rev. No. 21 of 2007 -------------------------------------------- Dated this the 30th day of August, 2010 JUDGMENT Ramachandran Nair, J. Heard Government Pleader and counsel appearing for the respondent-assessee. The question raised is whether the tribunal was justified in granting exemption to the assessee on the purchase turnover of rubber latex used in the manufacture of gloves for export. Respondent-assessee is an industrial unit in the Cochin Export Processing Zone and the purchase of latex is also made from another unit in the Cochin Export Processing Zone. Notification, SRO 1727 of 1993 entitles exemption for export-oriented units for purchase of industrial raw materials for use in manufacture. The notification provides for exemption to the seller on producing declaration obtained from the purchasing unitto the effect that purchase is for use in the manufacture of goods for export. However, in this case, seller of rubber latex is not liable for tax because the item is taxable at the last purchase point, and purchaser being manufacturer happens to be liable STRV 21/2007 2 to pay tax at the point of last purchase if exemption is not available. Department has no case that the item purchased is not used in the manufacture of rubber gloves for export. So much so, the condition in the notification is satisfied and the disallowance of exemption is only on technical ground that declaration contemplated under the notification has no application. We do not think on this technical ground exemption can be disallowed. In our view, declaration applies only to commidities which are taxable at sale point and the same does not apply to commodities taxable at last purchase where tax liability falls on the industrial unit itself if exemption is not available. In this case, respondent is eligible for exemption if they prove the ingredients of the notification with evidence that the item purchased, i.e., rubber latex, is used in the manufacture of gloves for export. Since the department has no case to the contrary, we uphold the order of the Tribunal and dismiss the revision filed by the State. (C.N.RAMACHANDRAN NAIR) Judge. (K. SURENDRA MOHAN) Judge. kk STRV 21/2007 3