2014 (7) TMI 360 - HC - VAT and Sales Tax

Exemption under notification dated March 6, 1991 - manufacturing of super enameled copper wire and insulated copper wire - Revenue contends that assessee had produced enameled wire therefore, the product should be treated as electric wire - Demand of differential tax and interest - Held that - The notification dated March 6, 1991 had clearly exempted from tax the sale of any product of copper provided it fulfils three conditions. For the purpose of this case, condition No. 1 is relevant which is that such copper is used as raw material in the manufacture of any other products of copper within the State of Rajasthan. According to the appellate authority, the assessee purchased the copper wires which were rolled, and the same were used as a raw material. Further, the assessee had sold the super enameled copper wire to M/s. Meter & Instrument Ltd., Chandigarh, for being used in meters. Therefore, the wires being produced by the assessee were nothing but the product of copper , although the said product of copper was enameled and insulated. Considering the fact that the copper which were rolled were bought, considering the fact that they were insulated and enameled, nonetheless they continued to be copper product . Therefore, they would fall within the exemption notification. Hence, the learned Board and learned appellate authority were fully justified in holding that the assessee would be entitled to the exemption under the said notification. - no substantial question of law is involved in the present case - Decided against Revenue.

Summary

Issues:
1. Interpretation of a notification granting exemption from tax on copper products.
2. Whether the product manufactured by the assessee qualifies as a copper product for exemption.

Analysis:
1. The judgment involves a dispute regarding the interpretation of a notification dated March 6, 1991, granting an exemption from tax on copper products. The primary condition for exemption was that the copper should be used as raw material in the manufacture of "any other products of copper" within the State of Rajasthan. The assessing authority did not consider the product manufactured by the assessee as a copper product, leading to the imposition of additional tax and interest. The appellate authority and the learned Board analyzed the facts and concluded that the product in question indeed qualified as a copper product based on the usage of copper wires as raw material and the nature of the final product being enameled and insulated copper wire.

2. The crux of the issue revolved around whether the product manufactured by the assessee could be considered a copper product for the purpose of claiming the exemption. The Revenue argued that since the final product was sold as electric wire, it should not be eligible for the exemption. On the contrary, the respondent-assessee contended that as per the notification, the product should be a "product of copper" after the manufacturing process. The court agreed with the assessee's argument, emphasizing that even though the wires were enameled and insulated, they remained fundamentally copper wires. The court upheld the decisions of the appellate authority and the learned Board, stating that the product continued to be a copper product and thus qualified for the exemption under the notification.

3. The judgment highlighted that the nature of the product, whether it qualifies as a copper product, is a question of fact. Since this factual aspect was thoroughly examined and determined by both the appellate authority and the learned Board, the court concluded that no substantial question of law was involved in the case. Therefore, the court refused to interfere with the findings of fact in its revisional jurisdiction. Ultimately, the court dismissed the petition, ruling that the assessee was entitled to the exemption under the notification, and the petition lacked merit for further consideration.