MODERN FOOD INDUSTRIES INDIA LTD Vs. ASSISTANT COMMISSIONER

JUDGEMENT

(1.) MODERN Bakeries (India) Limited made a daring debut in food industry. It gave to the consumer in neat and attractive packets its branded bread rich in nutrients and vitamins. Even the slicing had been done enabling an easy gulping or a quick enough toasting. With the development of the market for its products, it took to other items as well. Variety has its attractions whether it be in food, fabric or fashion. Bun was yet another product. It was placed on a par with the bread to all intents and purposes. It was so treated even by the Government initially. Later came a revision of its view by the Government. Bun is not bread but only a bakery product-was the new view taken by the Government. That view was expressed under an enabling power which the Government got under the amended Act of 1978 - section 59a. The change of view had serious impact on the fiscal position of the petitioner. It agitated its grievances along the hierarchy of statutory authorities. Even the Tribunal felt impelled to follow the directive of the Government under section 59a. Relief was therefore elusive for the petitioner. The final knock was at the court's door.

(2.) ELABORATE contentions of the petitioner on the factual front, and on the legal aspects were successfully presented to us by the petitioner's counsel Smt. S. K. Devi. We have already pronounced on the constitutionality of the section in our decision in O. P. Nos. 2300, 5082, 6130 of 1985, etc. (Reported as Travancore Chemical & Manufacturing Company Ltd. v. State of Kerala [1991] 81 STC 313 (Ker) ). The section has been struck down as violative of article 14 and for the reasons stated therein.

(3.) UNDISPUTED facts may be set out at the outset. For the purpose of these cases, history need be traced only from 1963 when the Kerala General Sales Tax Act, 1963, came into force. "bread" figures in item 14 of Schedule Ill of the Act. A conjoint reading of section 9 with that Schedule brings about the result that the sales are exempt from taxation. The position continued as such up to September 15, 1980.