9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
1974 (7) TMI 110 - HC - VAT and Sales Tax
Issues:
1. Interpretation of whether conversion of black gram and green gram into dal results in two different commodities. 2. Applicability of the proviso to section 5(2)(A)(a)(ii) of the Orissa Sales Tax Act. Detailed Analysis: 1. The primary issue in this case is whether the conversion of black gram and green gram into dal results in two different commodities. The Tribunal held that the conversion process does not change the nature of the goods significantly. However, the petitioner argued that a Supreme Court decision regarding the conversion of paddy into rice sets a precedent that supports the view that dal is a distinct commodity from the original grams. The common commercial understanding is that dal serves a different purpose than the raw grams, indicating a change in identity. The petitioner challenged previous decisions that favored the view that the converted products are the same as the original goods. 2. The second issue revolves around the applicability of the proviso to section 5(2)(A)(a)(ii) of the Orissa Sales Tax Act. The proviso states that if goods specified for resale are used for other purposes, the price of such goods should be included in the taxable turnover. In this case, the dal produced from black gram and green gram was not sold in the same form as purchased, leading to a violation of the declaration made at the time of purchase. The argument that the dealer's registration certificate covered a class of goods, including pulse products, was dismissed as the infringement of the declaration attracts the operation of the proviso. The court concluded that the proviso is indeed applicable in this scenario. In conclusion, the High Court of Orissa determined that the conversion of black gram and green gram into dal results in two different commodities and that the proviso to section 5(2)(A)(a)(ii) of the Orissa Sales Tax Act is applicable. The court upheld the decision that the dal produced from the grams should be considered a separate commodity for taxation purposes. The reference was accepted, and there was no order as to costs.
|
