COMMISSIONER SALES TAX Vs. BAREILLY ROPE STORES

JUDGEMENT

(1.) Raising a very interesting question whether or not coir yarn is covered by the entry at serial No. 1 of Notification No. S.T.-II-8224/X-9(213)-77-U. P. Act XV/48-Order-79 dated 31st August, 1979 published in U. P. Gazette Extraordinary dated 31st August, 1979, which is reproduced below : Serial No. 1. Yarn of all kinds except cotton yarn but 2 per cent." including 'desi kati' this revision is filed by the Revenue against the Tribunal's order dated 22nd March, 1986.

(2.) The assessee deals in coir yarn, niwar, dori rope, etc. The assessing officer taxed the turnover of coir yarn at the rate of 7 per cent treating that as unclassified item. The Assistant Commissioner (Judicial) [for short "the A. C. (J)"] affirmed the order of the assessing officer.

(3.) The Tribunal accepted the contention of the assessee that the item, namely, coir yarn, is governed by the aforementioned notification and, therefore, that deserves to be taxed as classified item at the rate of 2 per cent only. The crucial finding of the Tribunal is as follows : ...Coir is a industry of the South and I see no reason why the definition given in the Coir Industry Act should not be accepted. This Act, i.e., Coir Industry Act, 1953 makes it clear that coir yarn means yarn obtained by spinning of coir....