In Brief
The Commissioner of Commercial Tax, U.P. challenged the High Court's dismissal of a VAT revision. The respondent, a textile dealer, purchased materials and performed cutting and embroidery work to create unstitched ladies suits. The core issue was the correct tax classification under the UP VAT Act 2008. The Supreme Court held that the product—cut, embroidered, but unstitched—does not qualify as 'textile' under Schedule I (exempt) or 'textile made-ups' under Schedule II (4% rate). Instead, it falls under the residuary Schedule V entry, taxable at 12.5%. The Court rejected the ejusdem generis interpretation that 'other textile made-ups' encompasses unstitched items, and restored the original Assessing Authority's order.
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