- (1.) THIS order shall dispose of VAT Appeal Nos.134 of 2014 and other connected appeals, given in the foot note of the judgment raising identical following question: - "Whether in the facts and circumstances of the present case, HDPE/PP Woven Fabric is "Artificial silk" and therefore falls within the ambit of Entry 51 of Schedule B of Haryana VAT Act, 2003 ?
(2.) IN the present case the appellant is engaged in the business of manufacturing of High -Density Polyethylene/Polypropylene (for short 'HDPE/PP') fabric. The stand of the appellant is that it is purchasing HDPE/PP granules from the market as an industrial input in primary form. It is said that the PP granules are Homologous to HDPE granules. The input process is through various machines to produce a sheet. The sheet by another mechanical process is cut into tapes and tapes/yarn is produced. The tapes/yarns are subsequently by use of warp and weft (Tana -Bana) method is converted into HDPE/PP fabric. It is the stand of the appellant that HDPE fabric is exactly similar to PP fabric.
(3.) THE appellant in its return for the assessment year 2005 -06 showed the sale of HDPE fabric as tax free falling within Entry 51 to Schedule B appended to the Haryana Value Added Tax, Act 2003 (for short 'the Act'). The assessing officer treated the sales of HDPE fabric as tax free. But a show cause notice was issued under Section 34 of the Act read with Section 9(2) of the Central Sales Tax, Act 1956 proposing to revise the assessment orders for the reason that the sale of HDPE/PP fabric should have been taxed. The revision was allowed and tax liability created. The Deputy Excise and Taxation Commissioner exercising the revisional powers relied upon the clarification dated 10.12.2009 (Annexure A -7) issued by Financial Commissioner -cum -Principal Secretary, Government of Haryana, Excise and Taxation, Department. The appellant filed an appeal before the Haryana Tax Tribunal (for short 'the Tribunal). The Tribunal dismissed the appeal relying upon the order passed in STA No.684 of 2010 -11 titled as 'M/s Suraj Plastic Industries, Panipat Vs. State of Haryana', decided on 27.06.2011, later reviewed on 21.02.2012. The learned Tribunal noticed its earlier order in the case of M/s Rishab Farms and Industries Ltd. Gurgaon Vs. State of Haryana and others, VATAP No.161 of 2013, wherein considering the clarification dated 10.12.2009 held that HDPE will attract rate of tax at 4% in terms of fabric falling in Schedule C. However, the order in review was set aside by this Court and consequently the order dated 27.06.2011 is the order, on the basis of which appeal filed by the appellant was decided by the Tribunal. It is the said order which is subject matter of challenge in the present appeals.;