1974 (9) TMI 94 - HC - VAT and Sales Tax

Summary

Issues:
1. Interpretation of whether ammeters and voltmeters are considered electrical goods under a specific notification.
2. Determination of whether ammeters and voltmeters are operated by electrical energy.

Detailed Analysis:
The judgment delivered by the Allahabad High Court involved the interpretation of whether ammeters and voltmeters qualify as electrical goods under a particular notification. The court considered the relevant entry in the notification, which excluded equipment, plants, and accessories required for the generation, distribution, and transmission of electrical energy. The court examined the nature of ammeters and voltmeters, which are apparatus utilized for measuring the quantum of current. It was noted that these instruments cannot function unless electrical energy is made to pass through them. The court disagreed with the view that these instruments are not worked by electrical energy, emphasizing that they are indeed operated by electrical energy, as stated in the notification.

In a previous case, Commissioner of Sales Tax v. B.C.M. Franklin and Company, the court had to determine whether welding electrodes should be classified as electrical goods. In that case, it was found that welding electrodes, despite being melted using electrical energy, were not considered electrical goods because they could also be melted using other energy sources. The court highlighted the distinction between welding electrodes and ammeters/voltmeters, emphasizing that the latter can only function with the application of electrical energy, unlike welding electrodes.

Furthermore, the court referred to the case of Bansilal Agarwal and Brothers v. Commissioner of Sales Tax, where it was established that electrical goods encompass articles that require the use of electrical energy for their operation. The court also considered the case of Commissioner of Sales Tax v. Bharat Traders, Bareilly, which emphasized that for an item to be classified as electrical goods, it must be operated by electrical energy and fit the description of electrical goods. Applying this precedent, the court concluded that ammeters and voltmeters meet both criteria and should be assessed as electrical goods.

Ultimately, the court answered the question in the affirmative, ruling in favor of the department and against the assessee. The Commissioner of Sales Tax was awarded costs amounting to Rs. 100, and the reference was resolved in favor of classifying ammeters and voltmeters as electrical goods.