STATE OF KARNATAKA Vs. MARICO INDUSTRIES LTD

JUDGEMENT

(1.) The legality and correctness of the order passed in W.P.No.28125/2002 dated 3.1.2006 is called in question this appeal.

(2.) The facts leading to this case are as hereunder: The respondent is a dealer registered under the provisions of the Karnataka Sales Tax Act, 1957. The Writ Petition was filed by him challenging Entry 17-A in Part 'C of II Schedule of KST Act, 1957, specifying the 'coconut oil sold under the brand name' inserting the same with effect from 1.4.2001 and to quash the insertion of the words 'Coconut oil sold under the brand name in Entry 1 of Part 'E' of the II Schedule to K. S.T. Act, w.e.f. 1.4.2001. The respondent- assessee is a dealer and selling coconut oil apart from dealing with the other products. Prior to the amendment, coconut oil sold by him in sachets or in bottles with a brand name was attracting sales tax at 4% in S1.1 of part- E of the II Schedule of the K. S.T. Act. On account of the amendment, coconut oil sold would attract the higher rate at 15% w.e.f. 1.4.2001 and attracts 20% w.e.f.1.4.2002. The learned Judge after considering the case of the parties elaborately has granted relief to the assessee on the ground that the Entry 17-A in Part- C of the II schedule as unconstitutional, discriminatory and violative of Article 14 of the Constitution of India, so far as the coconut oil sold under the brand name, either in sachets or in bottles. This order is called in question in this appeal.

(3.) Though several grounds are urged by the appellants, at the time of arguments, the learned Government Advocate submits that the learned Judge has committed an error in granting relief to the respondent -assessee in quashing the notification. According to her, 95 to 96% of the coconut oil produced by the manufacturer and sold under the brand name, would be used for toilet purpose (as hair oil). But in the coastal belt 3 to 4% of the people would use the coconut oil as an edible oil. Therefore, she contends that there is a difference between the using of the coconut oil in the coastal belt and in the remaining parts. She further contends even people in and around the coastal belt are also using the coconut oil as hair oil. Considering the background it was for the Legislature to bring an amendment to brought the coconut oil under higher taxation side considering the nature of products which is used as toilet articles.