STATE OF KERALA Vs. JOSE

JUDGEMENT

(1.) What is yeast A living organism or a chemical The Revenue, for the purpose of taxation under the Kerala General Sales Tax Act, 1963 (for short the Act), wants to classify it as a chemical whereas to the assessee it is not a chemical, but a living organism and hence an unclassified item. This is the only dispute to be resolved in these cases. Therefore, it is not necessary to extensively refer to the factual position and yet for the purpose of understanding the background we may state the short facts.

(2.) The State is the revision petitioner in all these cases. The assessment years are 1989-90 to 1995-96. Till 31.3.1992 chemicals including caustic soda, caustic potash, soda ash, sodium sulphate and other chemicals not elsewhere classified were classified under Entry 42 to the First Schedule to the Act. From 1.4.1992 they are under Entry 29. Entry 156 for unclassified items was also introduced with effect from 1.4.1992. Till 31.3.1992 those items were treated under S.5(1)(ii) of the Act.

(3.) In T.R.C. Nos.95, 142, 143 and 153 of 2001 the assessing authority as well as the appellate authority treated yeast as a chemical and hence the respondents in those cases were the appellants before the Tribunal. In T.R.C. Nos.134, 141, 150 and 154 of 2001 the assessing authority treated yeast as an unclassified item and in suo motu revision the Deputy Commissioner reversed the findings of the assessing authority and directed assessments in those cases to be made treating yeast as a chemical and therefore, respondents / assessees were the appellants before the Tribunal. In T.R.C. Nos.135 and 204 of 2001 the assessing authority treated yeast as a vegetable preparation coming under Entry 56; but the first appellate authority reversed the finding of the assessing authority and treated yeast as an unclassified item and therefore State was the appellant before the Tribunal in those two cases. The Tribunal held that yeast is not a chemical, but a micro living organism which is not classified and hence directed the assessments to be completed treating yeast as an unclassified commodity. Aggrieved, the State has filed all these revisions.