M MUTHUSAVARI PILLAID Vs. STATE OF TAMIL NADU

JUDGEMENT

(1.) IN these two tax cases a common question of law is raised, though one case is in respect of the assessment under the Tamil Nadu General Sales Tax Rules, 1959, and the other under the Central ST Act,

(2.) THE assessees are dealers in cotton bandings and cotton ropes. In the assessment proceedings the assessees claimed a certain turnover relating to bandings and ropes as exempt under s. 8 r/w Item 4 of the Third Schedule insofar as the assessment under the Tamil Nadu General ST Act, 1959 (hereinafter referred to as the Act) is concerned, and under s. 9(2) r/w s. 8-A of the Central ST Act so far as the assessment under the Central ST Act is concerned. THE AO held that the bandings and ropes sold by the assesses are textiles within the meaning of item 4 of the Third Schedule to the Act and that, therefore, the turnover relating to the same is entitled to exemption. Accordingly the said turnover was deleted from the gross turnover under both the assessments.

(3.) IN these revision petitions the learned counsel for the assessees raised two contentions : His first contention was that the cotton bandings and cotton yarn sold by the assessee are textiles within the meaning of item 4 of the Third Schedule. He alternatively contended that, in any case, it would fall under the category of 'cotton yarn' under item 3 of the Second Schedule which is liable to tax at single point on the first sale in the state and that the turnover relating to sales of these articles are second sales and hence they are not liable to be included in the taxable turnover. This second contention was never raised either before the Dy. CIT or the Tribunal. Of course, there was no need for them to raise the same before the AO as he had succeeded even in his contention that they were textiles. Since the question raised related to the exemption of the same turnover, though under a different provision of law and the facts are also not in dispute, we permitted the learned counsel for the assessee to raise this alternative contention also.