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TMI Blog1979 (10) TMI 198X X X X Extracts X X X X X X X X Extracts X X X X ..... inserted into the dies and drawn by the use of the machines the ends have to be pointed and cut. This results in M. S. bar cuttings which are disposed of periodically to avoid accumulation. In respect of the assessment year 1967-68 the assessing officer included in the taxable turn over of the assessee a sum of Rs. 9,949.87 relating to these cuttings. The assessee preferred an appeal to the Appellate Assistant Commissioner contending that these sales of cuttings are only second sales of declared goods falling under item 4(c) of the Second Schedule to the Tamil Nadu General Sales Tax Act and that they are not liable to be taxed again in the hands of the assessee. The Appellate Assistant Commissioner allowed the claim and the Board took up su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are serialised. Item 4(c) reads as follows: "4 Iron and steel, that is to say,- (c) steel scrap, steel ingots, steel billets, steel bars and rods." The Supreme Court in State of Tamil Nadu v. Pyare Lal Malhotra[1976] 37 S.T.C. 319 (S.C.). had to construe entry No. (iv) in section 14 of the Central Sales Tax Act, 1956, which corresponds to entries in the Second Schedule to the Tamil Nadu General Sales Tax Act. The question was whether the manufactured goods consisting of "steel rounds, flats, angles, plates, bars" or similar goods in other forms and shapes could be taxed again even if the material out of which they were made had already been subjected to sales tax once as iron and steel scrap as both were "iron and steel". The Supreme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and fix the meaning of what is to be explained or defined." (emphasis* added) This judgment of the Supreme Court came up for application in State of Tamil Nadu v. S. Syam Steel Rolling Mills (P.) Ltd.[1977] 40 S.T.C. 156. In that case the assessee, having its factory in Bangalore, purchased in the State of Tamil Nadu M.S. rounds and transported them to Bangalore. The assessee subsequently sold in the State of Tamil Nadu M.S. rounds, M.S. angles and M.S. squares and claimed that no tax was payable on these sales since the goods were liable only to single point taxation and that the M.S. rounds purchased by it earlier in Tamil Nadu had already suffered tax. This claim was negatived by the assessing officer and the appellate authority on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee cannot claim exemption from tax in respect thereon the ground that the original commodity suffered tax." *Here italicised. What is thus necessary for the benefit of a single point taxation is either the retention of the identity of the goods or its identity as commercial commodity in trade. Merely because the goods undergo the process of cutting, it may not follow that the goods have lost their identity. But when they are scrap, they have lost their identity. The question whether in any particular case the goods are identical or not will have to be considered in the light of the facts and circumstances. The learned counsel for the assessee contended that even within item 4(c) there is an interchangeability and that so long as the g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. The rivetted baling hoops were considered as nothing but pieces of rolled steel sections joined together by rivetting, which fell within the same entry. Relying on this decision it was contended that in the present case what was subsequently sold by the assessee is the mild steel cutting from and out of the steel rods. It was not denied that there were some scraping and leavings in the process, though there were some small pieces of rods left which were the result of the process of cuttings. Even in the Gujarat case(2), it is a matter of doubt whether the goods retained the same character as steel sections when they were different commercial goods and sold as rivetted baling hoops. It may also be observed that this decision of the Guja ..... X X X X Extracts X X X X X X X X Extracts X X X X
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