LexT.V.L. NILSIN INDUSTRIES ETC. versus STATE OF TAMIL NADU
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A
T.V.L. NILSIN INDUSTRIES ETC.
v.
STATE OF TAMIL NADU
JULY 28, 1997
B
(S.P. BHARUCHA AND V.N. KHARE, JJ.)
Sales Tax,
Tamil Nadu General Sales Tax Act, 1959-Item 110/138 of First
C Schedule-Ultramarine blue-Used in whitening clothes-Pigment-Assessed
under Item 11()-/{igh Court upheld the stand of Sales Tax authorities-Held,
ultramarine blue or "nee/" is pigment-On appeal, liable to sales tax under
Item 110, as rightly held by the High Court.
The sales tax authorities considered ultramarine blue as a pigment
D falling under Item 110 of the First Schedule to the Tamil Nadu General
Sales Tax Act, 1959. The appellant assessess disputing the stand taken by
Sales Tax authority, contended that it was chemical falling under item 138
of the Schedule.
The High Court justified the stand of the Sales Tax authorities.
E Hence the present appeal.
Dismissing the appeals, this Court
HELD : Ultramarine blue or neel is a pigment, having regard to its
use as a whitener or colouring matter. The High Court has rightly come
F to the conclusion that ultramarine blue was a pigment and therefore liable
to sales tax under Item 110. [123-C-D]
G
M/s Ni/sin Company v. Collector of Central Excise, 1984 ECR 928,
approved.
N. Ganu Bhai v. Commissioner of Sales Tax, Madhya Pradesh, 36
S.T.C. 421 and Union of India & Ors. v. C.M.C. India, Ahmedabad, 1979
ELT 298, held inapplicable.
·
Asstt. Commercial Tax Office1; Jodhpur v. Rajasthan Chemical Cor·
H poration, 65 S.T.C. 356, disapproved.
116
T.V.L. NILSININDUSlRIESv. STATE[S.P. BHARUCHA,J.]
117
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 4282 of A
1991 Etc.
From the Judgment and Order dated 16.4.91 of the Madras High
Court in T.C. No. 249 of 1989.
R.P. Bhatt, Ms. S. Hazarika, Ms. H. Wahi and R.N. Keshwani for B
the Appellants.
V. Krishnamoorthy and T. Harish Kumar for the Respondent.
The Judgment of the Court was delivered by
c
S.P. BHARUCHA, J. These appeals, filed by assessees, challenge the
correctness of the judgment and order of a Division Bench of the High
Court at Madras. The question raised in these appeals is whether
ultramarine blue is a pigment, so that it falls under Item 110 of the First
Schedule to the Tamil Nadu General Sales Tax Act, 1959, as contended by D
the Sales Tax authorities, or a chemical, so that it falls under Item 138
thereof, as contended by the assessees. The High Court referred to
decisions of other High Courts and came to the conclusion that the stand
of the Sales Tax authorities was justified.
Item 110 reads thus :
E
SI. No.
Description of the goods
Point of
Rate of
levy
Tax%
110.
Paints, colours, dry distempers, At
the 10
varnishes and blacks cellulose point
of
F
lacquers, polish including metal first sale in
polishing bars (but not boot polish), the state.
pigments, indigo, enamels, cement
based waterpaints, oilbound
distemper, water pigments finishes
for leather, plastic emulsion paints,
G
turpentine oil, bale oil, white oil and
thinners.
Item 138 covers dyes and chemicals not otherwise specified in the
Schedule.
H
118
SUPREME COURT REPORTS [1997] SUPP. 3 S.C.R.
A
Our attention was invited by learned counsel for the assessees to the
judgments of the Madhya Pradesh, Rajasthan and Gujarat High Courts and.
we now refer to them seriatim.
In N. Ganu Bhai v. Commissioner of Sales Tax, Madhya Pradesh, 36
B S.T.C. 421, the dispute was whether ultramarine blue, or "nee!", was taxable
under Entry 25 of Part II of Schedule II of the Madhya Pradesh General
Sales Tax Act, 1958, or under the residuary entry in Part VI of Schedule
II of that Act. The former entry at the relevant time covered dyes and the
Sales Tax authorities contended that ultramarine blue was a dye and should
be taxed as such. The High Court referred to the Concise Oxford
C Dictionary which stated that ultramarine blue was a pigment made from
lapis lazuli .. It referred to Chambers's Encyclopaedia which stated that blue
pigments in common use by artists consisted of native and artificial
ultramarine, cobalt, indigo and prussian blue. It then referred to the
dictionary meaning of 'dye'. It found :
D
1113. Ultramarine blue is (a) pigment got either from "lapis lazuli"
or artificially by mixing clay, carbonate of soda, sulphur and resin,
(b) that when obtained from lapis lazuli or cobalt, it can be
permanent and can be used by artists for painting skies and
E
distances in landscapes, (c) when obtained artifiExcerpt shown. Read the full judgment & AI analysis in Lexace.