HDFC BANK LTD Vs. ASSISTANT COMMISSIONER ASSMT

JUDGEMENT

(1.) This is an appeal filed under Section 62(1) of the Kerala Value Added Tax Act, 2003 (hereinafter called, "the Act") challenging the clarification issued by the Commissioner of Commercial Taxes under Section 94 of the Act, on an application filed by another bank, namely, State Bank of India, clarifying that "10 gram gold rectangular bars" marketed by that bank and classifiable under HSN Code 7108.13.00 falls under entry 4(4) of the Third Schedule to the Act and is taxable at four per cent. State Bank of India which applied for clarification has accepted the order of clarification issued by the Commissioner and Government Pleader has produced copy of the return filed by them offering tax at four per cent on the turnover of 10 gm. rectangular gold bars sold in the market. However, the Appellant which is a bank in the private sector, has challenged the order of clarification issued by the Commissioner in the case of SBI contending that the clarification is incorrect because according to the Appellant, item is classifiable under HSN 7108.12.00 falling under entry 1(2) of the Second Schedule to the Act attracting tax at one per cent under the head "bullion". We have heard counsel appearing for the Petitioner, Government Pleader for the Respondent and have seen samples of the product marketed both by the SBI on whose application the impugned clarification was issued and by the Appellant which is contesting the clarification issued by the Commissioner on SBI's application, which is produced as annexure C in the appeal filed by them.

(2.) In the first place, we have to refer to the Rules of interpretation of the Schedules contained in appendix to the Act. What is stated in the Rules of interpretation is as follows :

(3.) The disputed entries for classification are the following :