SREE ARUNACHALAESWARA MILLS Vs. STATE OF TAMIL NADU

JUDGEMENT

(1.) VENKATASWAMI, J. In all these cases, a common question of law arises for our consideration, namely, whether cotton yarn blended with staple fibre in small percentage will still be cotton yarn for the purpose of section 14 (ii-b) of the Central Sales Tax Act, 1956, and consequently, will also be "cotton yarn" for the purpose of entry 3 of the Second Schedule to the Tamil Nadu General Sales Tax Act, 1959, as it stood prior to 1st March, 1982. If our answer to the above question is in the affirmative, the further question that also arises for our consideration, is whether the introduction of entry 18a in the First Schedule to the Tamil Nadu General Sales Tax Act by Tamil Nadu Act 28 of 1980 makes any change in the above position.

(2.) SECTION 14 (ii-b) of the Central Sales Tax Act, 1956 (hereinafter called "the Central Act") and entry 3 of the Second Schedule to the Tamil Nadu General Sales Tax Act, 1959 (hereinafter referred to as "the State Act") as they stood prior to 1st March 1982, read as follows : " Cotton yarn, but not including cotton yarn waste. "

(3.) IN all these cases, the assessees are manufacturers and sellers of cotton yarn. It is the case of the assessees in all the cases that blending of staple fibre is only below 10 per cent whereas the case of the Revenue, as seen from the counter-affidavit, it that the blending of staple fibre varies from 10 per cent to 16 per cent.