STATE OF KERALA Vs. GLAXO SMITHKLINE PHARMACEUTICALS LTD

JUDGEMENT

(1.) The question raised in the revision filed by the State is whether the Tribunal was justified in holding that the product sold by the respondent under the name Equal in tablet and powder form attracts tax only at the rate of 8% under the residuary entry of first schedule of KGST Act as against the rate of 12% applied by the assessing officer treating the assessed item as one falling under Entry 62 of First Schedule of the KGST Act.

(2.) We have heard the Government Pleader for the petitioner and Smt. K. Latha, the counsel appearing for the respondent, and have gone through the orders of the lower authorities and that of the Tribunal.

(3.) The product is admittedly a sugar substitute and is a sweetening agent for beverages and food. It is extensively used by Diabetic patients and those who want to reduce weight. Compared to sugar, as a sweetening agent used in food and beverages, Calorific value of Equal is very low. In fact, several other companies are engaged in the production and sale of sugar substitute of the kind produced and marketed by the respondent, under their brand names. Government Pleader has produced the product description available in the Website of the respondent wherein the product is described in the Website as Aspartame which is composed of two amino acids (the building blocks of protein). The company claims that, in the body, aspartame breaks down into the amino acids aspartic acid and phenylalanine, as well as a small amount of methanol-components found naturally in foods like meats, milk, fruits and vegetables. It is further stated that the body recognizes and uses these components in exactly the same way, whether they come from aspartame or common foods. Safety of the product is approved by the American Medical Association, the American Dietetic Association and the American Diabetes Association. It is specifically claimed in the Website that the product Equal is one of the most tested food ingredients in FDA history and is currently used in over 6000 products.