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TMI Blog1976 (6) TMI 58X X X X Extracts X X X X X X X X Extracts X X X X ..... cision of the Supreme Court in Burmah Shell s(1)case. He also treated the goods involved as electrical goods falling under item 41 of the 1st schedule r/w STT.3(2) and assessed the disputed turnover at 9 per cent. The AAC segregated the electrical equipment attached to the machine and assessed it on Rs. 3,000 at 9 per cent and the balance at multi-point rates under s.3(1).Aggrieved of this decision under STT.31 the present appeal was preferred before us. 3. The Appellants claim that the sales should be excluded and deleted from the scope of assessment, treating them as not having been done in the course of business. They also presented that there is no scope for treating a portion of the deal as related to electrical goods. The State Representative amplified the approaches of the lower authorities and sought for the dismissal of the appeal. 4. The appeal involves two specific points for our consideration and decision:(i)whether the disputed transaction merits treatment as not having been done in the course of trade and (ii)whether the treatment for assessment at 9 per cent on Rs. 3,000 is in order. 5. The first count involves the disposal of discarded machinery. The purchase ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s for an extremely accurate medium capacity heavy duty unit. It is completely self contained in all steel case and features simplicity of set up and maximum versatility. Cutting speed and stroks are fully variable and all operating and adjustment controls are conveniently located for ease of operation" Pages 25,27,29 and 31 furnish operating details pertaining to the machine which indicate that the machinery, as a whole, is a hydraulic machinery. The other details available on record, as could be elicited from the producer s brochure and other records, also indicate that machinery is basically a hydraulic one. Its operation in mainly through hydraulic system. (iii) Broaching is a method of machining the metal. In that process the metal is removed by a multiple teeth which is either pulled or pushed through the surface of the work piece. While explaining the process the following detailed facts were also placed before us. "We have a plate which acts as a fixture for holding the job. Having fixed the job on the fixture, the special tool specifically made for the particular operation, which is called a "Broach", is inserted into the chucking mechanism through the fixture and j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had except with the use of electric energy, can be termed as electrical goods or appliances. (ii)This view has amplified by the Lordships of the Madras High Court in 11 STC 340 while examining the issue whether a lathe driven by electrical energy could fall within the meaning of "electrical goods" under the Act, expressed the following view: "It is rather difficult to hold that a lathe, by itself, even though drive by electrical energy will come within the scope of the expression electrical goods We have pointed out that, in this case, the lathe in question was fitted with electrical motors, one main motor and six auxiliary motors. The Tribunal no doubt pointed out that without the use of electrical energy this lathe could not be used at all, and the Tribunal also pointed out that if the lathe was to be worked with power other than electrical power, it would require changes, extensive changes. But nonetheless the position remains, it is a lathe, which was provided with electric motors for its use. Even a lathe designed for use normally with electric motors may not become electrical goods. Electric motors which no doubt form an integral part of the lathe in question are still ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l goods. Electric motors may no doubt form an integral part of the broaching machine but still they are only to provide the motive power for working the machine. We therefore feel that there is no scope to treat it as "electrical goods" as presently done in this instance by the lower authorities. 8. (i)The concept of common parlance also has application to this instance case. The broaching machines are not generally considered to be electrical goods in common parlance. Though the authorities have not considered the scope for the application for this test, we feel that this test on application would result in a treatment favourable to the appellants. The Bombay High Court in Traub India Ltd. vs. State of Maharashtra has referred to this test. It was expressed as under: "In the light of the above judgements of the Supreme Court, it is clear that the basis upon which both the Commissioner of Sales Tax and the Tribunal proceeded in the present case is erroneous and insupportable in law. Neither the Tribunal nor the Commissioner applied the common parlance test nor did the Commissioner take any evidence as to whether the type of lathes sold by the applicants was understood in the co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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