- (1.) These three Sales Tax Revision Petitions by the petitioner-Revenue are directed against common order of the Rajasthan Tax Board (for short, 'Tax Board') dt.03/03/2008, are relevant for the Assessment Years 2002-03, 2003-04 and 2004-05.
(2.) Brief facts noticed are that the respondent-assessee is carrying on the business of manufacturing and sale of Kirana items and spices at their factory at Ahmedabad and are also having office at Jaipur for trading in the aforesaid items. The respondent-assessee is also trading in spices like Chilli Powder (Mirchi), Coriander Powder (Dhaniya), Turmeric Powder (Haldi), Cumin Seed (Jeera), Asafoetida (Hing) etc.. It was noticed by the Assessing Officer (for short, 'AO') that the respondent was paying tax @4% on the spices/ Kirana items sold singly and tax @16% on Masalas which were a mixure of two or more spices. However, the AO was of the view that in so far as Asafoetida (Hing) is concerned, the tax of 4% only was being paid but the AO was of the view that it falls in the category of Packed Masala and once it is a Packed Masala, it falls in the entry where levy of tax is @16%. The AO, being not satisfied with the claim of the respondent-assessee, issued a show cause notice, inter-alia, stating that as to why the Asafoetida (Hing) be not taxed as that of Packed Masala and as to why rate of 16% be not applied. The respondent-assessee furnished detailed explanation, inter-alia, contending that they have sold Asafoetida (Hing) and the tax only @4% is applicable on the sale of Asafoetida (Hing) and that it does not fall in the category of Packed Masala. It was further contended that Asafoetida (Hing) is obtained from roots and to reduce the pungent in the Asafoetida (Hing) , only gum arabic and wheat flour are added and merely because these two items are used in the process, it does not mean to fall in the category of Packed Masala. It was further contended that it falls purely in the category of Kirana items and not Packed Masala. It was also contended that in many other States namely: Madhya Pradesh, Punjab, Gujarat, Delhi, Jharkhand, Bihar where also Asafoetida (Hing) is treated as Kirana Item and not as Packed Masala. However, the AO, on the basis that on the packet it was mentioned/printed "Ram Deo Super Compunded Asafoetida Ingredients; 1-Edible Gum, Wheat Flour 30% Aprox. Best before within 11 months from the date of packaging" and that it includes Edible Gum, Wheat Flour, therefore, it falls within the definition of Packed Masala and accordingly levied tax @16% and also directed for levy of interest as also penalty u/Sec.65 of the RST/VAT Act.
(3.) The matter was assailed in appeal before the Deputy Commissioner (Appeals) (for short, 'DC(A)'), who, however upheld the finding of the AO and rejected the appeal.;