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TMI Blog1961 (9) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... rers of cotton, woollen and silk goods in Bangalore and they are registered dealers in those goods. They manufactured and sold silk goods from their mills. There was some dispute as to whether the silk goods manufactured by the respondent-mills were textiles woven on "power-looms" or manufactured in a "mill" for the purpose of levy of sales tax. The Commissioner of Commercial Taxes in Mysore, Bangalore, instructed the respondent-mills to collect sales tax on the silk goods sold by them at the rate of 1 anna per rupee on the basis that they were textile goods produced by a "mill" pending the question whether the contention of the respondents that they are power-loom goods is justified. Accordingly the respondent-mills collected from their at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ron, worn out and broken parts of machinery, old papers, tubes and unserviceable metal coils etc. during the relevant period. In so far as the amount realised by the sales of these sundries are concerned, it was contended by the respondent-mills that they had not sold these sundries in the course of their business and as such those sale transactions were not liable to any taxation. The Sales Tax Officer rejected all these three contentions of the respondent-mills. He held that so long as the respondent-mills had collected the sales tax at the rate of 1 anna per rupee from their customers on the silk goods sold to them they were not entitled to have it refunded. In so far as the second contention of the respondent-mills is concerned, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hem were subject to sales tax of 0-0-6 per rupee, the State was not entitled to claim the excess amount. It was submitted that the respondent-mills had undertaken to refund the excess amount collected to their customers. In support of this contention, the respondent-mills relied on the decision reported in Minerva Mills and Another v. State of Mysore[1956] 7 S.T.C. 148. The learned Deputy Commissioner of Commercial Taxes rejected this contention. He observed in the course of his order that though this Court had held that the State was not entitled to claim any amount collected in excess of the tax legally leviable in Minerva Mills and Another v. State of Mysore[1956] 7 S.T.C. 148., the same had not been finally accepted by the Supreme Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion that the appellants were bound to refund the same to their constituents in case of demand from them. The Tribunal was further of the opinion that in so far as the transaction carried on in the "Works Peoples Stores" was concerned, it was only an "amenity" specifically meant for the employees of their mills and those transactions could not constitute a business activity carried on by the respondent-mills with any profit motive, though in that particular year there was a small profit earned by the mills and on that basis held that the sale transactions were not taxable. In coming to these conclusions, the Tribunal relied on a decision of this High Court in Davanagere Cotton Mills Ltd. v. State of Mysore and Another[1957] 8 S.T.C. 793; A.I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r High Court of Mysore (before States Reorganisation) and as the same was not binding on this Court, we should consider the point afresh. One of us was a party to the above decision. The said decision had been taken in appeal to the Supreme Court of India, and the Supreme Court did not express any opinion contrary to the opinion of this Court. In these circumstances, we do not find any ground to dissent from the opinion expressed in the above-said case. I am, therefore, of the opinion that the conclusions reached by the Tribunal that the respondent-mills is entitled to the refund of the sales tax paid by them in excess of 0-0-6 in the rupee is correct and cannot be interfered with. In so far as the turnover relating to the business carrie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had applied for registration as dealers stating that they were carrying on the business of selling yarn, cloth, cotton, cotton waste, stores etc., and they had been accordingly registered. In these circumstances, their Lordships of the Bombay High Court held that it was quite possible to readily infer that the transactions of sale were in the course of the business of the assessees. But in the instant case before us, it is not even suggested that the respondent-mills had got registered itself as a "dealer" for carrying on the business of selling waste cotton, useless ropes, scrap iron, worn out and broken parts of machinery, old papers, tubes and unserviceable metal coils etc., as in the Bombay case referred to above. Shri Venkataswamy fai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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