RAJASHREE CEMENT Vs. STATE OF KARNATAKA

JUDGEMENT

(1.) RAJASHREE Cement is before us in this appeal. Petitioner is a company engaged in the manufacture of cement in Gulbarga District. Assessment for the year 1998-99 came to be concluded in terms of an order dated 6-1-2001. It was subsequently revised in terms of a subsequent order dated 3-3-2001. In the subsequent order the assessing authority rejected the claim of exemption claimed by the petitioner with regard to the purchase of polypropelene bags (PP Bags) as classifiable under Entry 70 based on the earlier orders passed by two coordinate Benches of the Tribunal and levied tax under the provisions of the Karnataka Tax on entry of Goods Act (for short 'the Entry Tax act') at the rate of 2% stating that the goods caused entry into the local area by the petitioner are classifiable under Entry 66 of the I schedule, as packing materials. Aggrieved by the said order, appeals were filed before the appellate authority. The appellate authority confirmed the findings of the assessing authority. Aggrieved by the same, a further appeal was filed before the Tribunal. The Tribunal rejected the case. Petitioner has also claimed that the petitioner is liable to pay only 2% on Light Diesel Oil and not 5% despite the notification issued by the Government. That contention also stood rejected. The assessing officer levied penalty and the penalty is confirmed by the Appellate Commissioner and the Tribunal. It is in these circumstances, petitioner is before us raising the following questions of law:

(2.) HEARD the learned counsel for the parties.

(3.) LEARNED counsel for the petitioner would contend that the subsequent Entry 70 is applicable insofar as PP Bags and not Entry 66 (iii) as held by the authorities. He would further argue that despite a notification issued by the Government, the petitioner is liable to pay 2% in the light of the notification dated 31-3-1998 issued by the Government. He would also say that levy of penalty is unsustainable. Per contra, learned counsel for the revenue would support the order. She would also say that PP Bags are nothing but packing material and it falls under Entry 66 (iii) of the act. She wants the impugned order to be confirmed.