1965 (11) TMI 127 - SC - VAT and Sales Tax

Certificate of registration - Held that - Appeal dismissed. The High Court was right in holding that these two items, namely, spare parts of motor vehicles including tyres and tubes, and motor trucks cannot be included in the registration certificate of the appellant. As far as furniture and sanitary fittings are concerned, these are covered by the ratio of the decision of this Court in the Indian Copper Corporation case ( 1964 (10) TMI 41 - SUPREME COURT OF INDIA ). In dealing with stationery use of stationery undoubtedly facilitates the carrying on of a business of manufacturing goods or of processing goods or even mining operation but the expression 'intended to be used' cannot be equated with 'likely to facilitate' the conduct of the business of manufacturing or of processing goods or of mining . These observations apply to the items furniture and sanitary fittings . These two items are likely to facilitate the business of mining but it cannot be said that they are intended to be used in mining.

Summary

Issues:
1. Interpretation of rule 13 of the Central Sales Tax Rules regarding the specification of goods in the registration certificate.
2. Inclusion of various items in the registration certificate under the Central Sales Tax Act.
3. Whether spare parts for motor vehicles, motor trucks, furniture, and sanitary fittings can be included in the registration certificate for a mining company.

The Supreme Court of India heard an appeal against the High Court's order dismissing an application under Articles 226 and 227 of the Constitution. The appellant, a mining and coal trading company, applied for registration as a dealer under the Central Sales Tax Act. The company sought inclusion of various goods in its registration certificate beyond lubricant oil, fuel, and explosives initially granted. The Sales Tax Officer refused to include items like iron and steel, motor trucks, spare parts for vehicles, etc., stating they were not directly used in the manufacturing process of coal. The appellant filed a revision under the Madhya Pradesh General Sales Tax Act, which was also dismissed. The High Court upheld the Sales Tax Officer's decision, leading to the appeal before the Supreme Court.

The appellant argued for the inclusion of items like spare parts for vehicles, motor trucks, furniture, and sanitary fittings in the registration certificate, citing a previous judgment regarding the specification of goods. However, the Court noted that the appellant did not provide evidence of actually manufacturing coke, a claim made during the appeal. The Court held that without documentary proof, the new argument could not be considered at that stage. Additionally, the appellant's argument that motor trucks were needed for transporting coal to the railway siding was rejected, as the goods intended for use in mining should be limited to activities directly related to mining operations, such as raising and storing coal, not transportation to a railway siding.

Regarding the inclusion of furniture and sanitary fittings, the Court applied the precedent set in a previous case and concluded that while these items could facilitate mining activities, they were not intended to be used in the mining process itself. The Court emphasized that the goods specified in the registration certificate must be directly related to the mining activities. Therefore, the Court upheld the decision of the High Court, ruling against the inclusion of spare parts for vehicles, motor trucks, furniture, and sanitary fittings in the appellant's registration certificate. The appeal was dismissed with costs.