1996 (8) TMI 455 - SC - VAT and Sales Tax

Whether trucks, trolleys, trailers and the like, but not passenger vehicles, as also their accessories and spare parts, tyres and tubes could be purchased by the respondent-Board at the concessional rate of tax prescribed under section 8(1) of the Central Sales Tax Act, 1956, and that, to make things clear, the respondent-Board was entitled to have its registration certificate altered to include tools and plants, including vehicles and other transportable goods, including their spare parts, tubes and tyres ? Held that - Appeal dismissed. If a process or activity was so integrally related to the ultimate manufacture of goods so that without that process or activity manufacture may, even if theoretically possible, be commercially inexpedient, goods intended for use in the process or activity as specified in rule 13 would qualify for special treatment. The motor vehicles aforementioned and soaps, paints, raincoats and battery cells, to the extent aforementioned, are integrally related to the distribution of electricity and their non-use would make distribution commercially inexpedient

Summary

The High Court held that the respondent-Board could purchase trucks, trolleys, trailers, accessories, spare parts, tyres, and tubes at a concessional tax rate for distribution of electricity. Soaps, paints, varnishes, raincoats, and battery cells were also allowed for specific purposes. The Supreme Court dismissed the appeals with no costs.