9.PROCEEDINGS OF THE COMMISSIONER OF COMMERCIAL TAXES

                                 THIRUVANANTHAPURAM

    Present:  Sri.Paul Antony.IAS

Sub:- KVAT Act 2003- clarification sought for under Section 94 on rate of tax of  Vilakkuthiri- orders issued- reg:

Ref: - 1. Application put in by Sri.V.Bhaskaran, Deepam Thread, Kanjiramkulam, Neyyattinkara dt, 18.07.05.

          2.Posting Notice No.VC1.37806/05 Dtd. 17.08.05.

                         ORDER NO.C3.37806/05/Dated.21..12.05

                M/s. Deepam Threads, Kanjiramkulam, Neyyattinkara has preferred an application under Section 94 of KVAT Act, 2003 requesting to clarify the rate of tax of “Vilakkuthiri”

        Sri.Hussain, Counsel for the applicant was heard. The counsel contends that the product “Vilakkuthiri” is exempted as it is made by merely cutting cotton yarn into pieces of suitable length.

        As per Entry 14 of the First Schedule “Cotton and silk yarn in hank” only is exempted. Hence commodity dealt by the applicant does not come under this entry. Moreover the item “Cotton yarn” comes under the sub-entry (6) to Entry 143 of Third Schedule.

        Entry 143 of Third schedule read as “Yarn of all kinds other than cotton and silk yarn in hank and sewing thread”. As per sub-entry (6) to Entry 143 “Cotton yarn” is taxable @ 4 %. Hence the item “Vilakkuthiri” which is cut pieces of small length is also cotton yarn taxable @ 4%.

        The issue raised by the applicant is clarified as above.

                                                                                Sd/

                                                                        Commissioner