(2008] 11 S.C.R. 355

..,

MIS. PIOMA INDUSTRIES ETC. ETC.

A v.

STATE OF KERALA (Civil Appeal No. 4639 of 2008)

JULY 25, 2008

.._ "*-

[DR. ARIJIT PASYAT AND P. SATHASIVAM, JJ.]

Kera/a General Sa/es Tax Act, 1963 - Schedule I, Entries 56 and 57 (for year 1997-98) Entries 124 A (for the year

1999-2000) - 'Rasna' - Taxability- Whether as a 'beverage' c or 'non-alcohoic drink' - Plea of assesseee that it is taxable as 'vegetative food preparation' or 'beverage' but not 'non-a/- coholic drink' - Authorities/Courts below holding it as 'non-a/- coholic drink' - Held: the assessing authority did not consider whether the article could be a 'beverage' - Effect of introduc- D tion of entries 124A and 141 also not considered - Hence matter remitted to Tribunal.

The question for consideration was whether 'Rasna' is taxable as 'beverage' or 'non-alcoholic drink'. The authorities and courts below had held that the same was a E

'non-alcoholic drink'. Hence the present appeal.

Partly allowing the appeal, the Court

HELD: The assessee had taken the stand that the article in question was 'vegetative food preparation' and F

----+ in the alternative it was a 'beverage'. The stand taken by the appellants about the article being 'beverage' has not been specifically considered by the assessing authority, the first appellate authority, the Tribunal and the High Court. Whether a particular article can be called as a 'bev- G erage' has to be factually decided. Similarly, the effect of

~ the introduction of the Entries 124A and 141 in the As- -

"( sessment year 1999-2000 has not been considered. Therefore, the effect of the change from 1.1.2000 has also not

355 H

"" A been considered and has not been analysed. In the circumstances, the matter is remitted to the Tribunal to examine whether 'Rasna' can be treated as 'beverage' for the assessment year 1997-98; and what is the effect of the Entries 124A and 141 vis-a-vis Entry 97 for the Assess- B ment year 1999-2000. [Paras 7 and 8] [359-H; 360-A-C]

CIVILAPPELLATE JURISDICTION: CivilAppealNo. 4639 ~

of.2008

From the final Judgment nd Order dated 3.8.2005 of the c High, Court of Kerala at Ernakulam in ST. Rev. Nos. 271 and .353 of 2003 and 320 of 2005

Mathai M. Paikeday, Shishir Pinaki, Amit Singh and Sanjay Jain for the Appellant.

JD T.L.V. Iyer, P.V. Dinesh and T.P. Sindhu for theR_espondent.

The Judgment of the Court was delivered by

 DR. ARIJIT.'PASAYAT, J. 1. Leave granted.

2. Challenge in this appeal is to the judgment of a Division

Bench of the Kerala High Court dismissing two revision petitions filed by the appellants i.e. Mis. Pjoma Industries, and Mis. Rasna Pvt. Ltd. The assessment years involved are 1997-

F. 98 and 1999-2000. The dispute lies within a very narrow compass.

3. The question is whether "Rasna" is taxable as a 'beverage' or 'non-alcoholic drink'. For the two assessment yea, rs the . relevant entries were Entry 56 and Entry 87 respectively for the G . year 1997-98 and forthe year 1999-2000Entry12~A. 141 and .. 97 respectively. The assessing officer, the first Appel.late Au- .. thority, the Tribunal and the HighCourt held that "Rasna" is to

I>- be taxed as 'non-Alcoholic drinl<'. .,,, ...

4. According to the learned counsel for the appellants, H 'Rasna' is a powder which is nothing but a soft drink concen-

 M/S. PIOMA INDUSTRIES ETC. v. STATE 357

OF KERALA [DR. ARIJIT PASAYAT, J.]

trate and cannot be taken to be as 'non-alcqholic drink'. It is A nothing but a fruit in a powder form and a vegetative food preparation. It is pointed out that the legislature in its wisdom has taken out some of the items which were earlier in Entry 87 and have grouped them together under different Entries.

5. Learned counsel for the respondent-State on the other 8

... -1. hand submitted that by no stretch of imagination 'Rasna' has been treated as 'food or vegetative' and has therefore been rightly assessed as 'non alcoholic drink'.

, ·~

6. Entries for the two relevant assessment years read as . c follows:

In the year 1997-98 I Entry Details of goods Point of levy Rate of , No. tax

56.

Food including vegetative or At the point of 12.5% D

animal preparations sold in first sale in the airtight containers and food State by a colours, essences of all kinds dealer who is and powders or tablets used liable to tax unfor making food preparations der Section 5 E

or beverages

87.

Non-alcoholic drinks, squashes, Do 20%

saucesAeratd waters, mineral

watr. beverages Horlicks, Boost, Boumvita, Complan, Glu- F

case- D, Glucovita and similar items whether bottled or canned or packed

Explanation : Powders, tablets G and concentrates used for the preparation of non alcoholic drinks, shall whether or not they are bottled or canned be liable to tax under this entry.

A During 1998 - 99

' 56. . Food including vegetative or At the point of 12.5%

animal preparations sold ih first sale in the airtight containers and food state by a

B colours, essences of all kinds dealer who is and powders or tablets used liable to tax unfor making food preparations der Section 5 ' Qr beverages ·

87.

Non-alcoholic drinks, Do 20% c squashes, sauces Aerted waters, mineral water, bever- '. ages Horlicks, Boost, Bournvita, Complan, Glucose- D,. Glucovita and similar items whether bottled or canned or 'packed D

Explanation : Powders, tablets and concentrates used for the preparation of non alco- E holic drinks, shafl whether or not they are bottled or canned be liable to tax under this entry.

F During 1999-2000 tiil 31.12.1999

87.

Food including vegetative or Do 25% animal preparations sold in .airtight containers and food

colours, essences of all kinds G and powders or tablets used for making food preparations or beverages 124A squashes, sauces soda, min:- Do 20% 'eral water Horlicks, Boost H Bournvita, Complain,

MIS. PIOMA INDUSTRIES ETC. v. STATE

OF KERALA [DR. ARIJIT PASAYAT, J.]

Glucose-D, Glucovita and similar items whether or not bottled canned or packed Explanation: powders, tablets, granules and concentrates used for the preparation of beverages shall, whether or not they are bottled or canned, be liable to tax under this entry.

. From 1-1-2000

97- Non alcoholic drinks whether Do or not bottled or canned or packed Explanation _ Powders, tablets, granules and concentrates used for the

prepartion of non-alcoholic drinks, shall whether or not they are qottled or canned be liable to tax under this entry.

141 Squashes, sauces, fruitjuice, Do fruit pulp, soda, mineral water, Horlicks, Boost, Bournvita Complan, Glucose-D, Glucovita and similar items whether or not bottled canned or packed. Explanation-Powders, tablets Granules and concentrates used for the preparation of beverages shall, whether or not they are bottled or canned, be liable to tax under this entry.


25%

20%

7. It appears that assessee had taken the stand that the H

A article in question was vegetative food preparation and in the

alternative it was a beverage.

8. It was also highlighting the fact that in 1999-2000 the Entry 87 as it stood in the year 1997-98 was split into two parts Le.£ntries.87 and 124A. The explanation to the E'.ntries 87 and B 124A has also relevance. Undisputedly, Entries 87 ad 97 relate to non-alcoholic drinks. It appears that the stand taken by the appellants aboutthe article being "beverage" has not been specifically considered by the Assessing Authbrity,· the First . appellate Authority, the Tribunal and the High Court. Whether a C particular.article can be called as a "beverage" has to be factuallrdcided. That analysis has not been done. Similarly, the effect of the. introduction of the Entries 124A and 141 with the Assessment year 1999-2000 has not been considered. Therefore, the effect of the change from 1.1.2000 has also not been D considered and has not been analysed. In the circumstances, we remitthe matter to the Tribunal to examine the following:

1. Whether 'Rasna' can be treated as beverage for the assessment year 1997-98.

E '

2. To examine the effect of the Entries 124A and 141 visa-vis Entry 97 for the Assessmen.t year 1999-2000.

9. The appeal is allowed to the aforesaid extent.

K.K.T.

Appeal partly allowed.