The department’s petition for revision of the Odisha Sales Tax Tribunal’s ruling was denied by the bench of Chief Justice Dr. S. Muralidhar and Justice Raman of Orissa High Court (HC). The product “Good Knight” was decided to fall under the “Insecticide” category under Entry 30 of Part II of Schedule B to the Odisha Value Added Tax Act (OVAT) and be subjected to 4% tax.
The department is debating whether Godrej’s product should be labelled as “insecticide,” which carries a 4% tax, or if it should be included in Part III of Schedule B to the OVAT Act’s list of “all other commodities,” where it would be subject to a 12.5% tax.
The bench observed that one of the principal ingredients of the product is ‘Transfluthrin 0.88% w/w Liquid Vaporiser.’. It is explained in the said literature that Transfluthrin 0.88% w/w Liquid “is an effective insecticide recommended for the control of adult mosquitoes in the household”.
Also considered, the certificate of registration of insecticides under Section 9 (3) of the Insecticides Act, 1968 for manufacture of the said insecticide transfluthrin 1.6% w/w Liquid Vaporiser submitted by the counsel appeared on behalf of the respondent (Godrej).
The HC remarked that the product sold by the Opposite Party- Dealer has been correctly categorized as an ‘insecticide’ under Entry 30 of Part II of Schedule B of the OVAT Act.
The bench observed that no error had been committed either by the Assistant Commissioner of Sales Tax (ACST) or the Tribunal in accepting the plea of the dealer and negating the contrary plea of the Department.
Recently in the similar case of same respondent dealer (Godrej), in the case M/S Godrej Sara Lee Ltd. vs The Excise And Taxation Officer, the supreme court presided by Justice Ravindra Bhatt and Justice Dipankar Datta nullified or quashed the Revisional Order of the revising authority which imposed 10% on the mosquito repellant ‘Jet Mat’ of the Godrej. Also held that the product comes under the insecticide category and is subject to 4% tax.
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