State of Andhra Pradesh vs Rama Krishna Industries

Bhaskar Rao, J.—The question arose in this case is whether the hessian cloth bags with polythene lining and craft paper fall under entry 19 or entry 67 of the First Schedule.

The Tribunal has held that they fall under entry 67 of the First Schedule. This is challenged by the State stating that under entry 67 of the First Schedule, hessian cloth and jute twine are taxable. But, in this case, the hessian cloth is provided with a polythene lining and craft paper for extra protection of chemicals. Entry 67 contains only hessian cloth and jute twine and bags made of hessian cloth are not mentioned whereas in entry 19 containers other than gunnies and bottles are mentioned. Therefore, they fall under entry 19 of the First Schedule.

By seeing both the entries, it is clear that under entry 67 hessian cloth and jute twine are only taxable and there is no mention regarding hessian cloth bags. Therefore, it cannot be held that they fall under entry 67. Under entry 19 of the First Schedule, "containers other than gunnies and bottles" are taxable. Therefore, they are liable to be taxed under entry 19 of the First Schedule as a container for the loading of chemicals.

Therefore, the revision case is allowed and the order of the Tribunal is set aside. No costs.

Petition allowed.