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TMI Blog1980 (2) TMI 250X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the case was sent back for decision afresh. In revision, the accounts were accepted, but the order of remand was upheld as the claim of the assessee that it was not the first purchaser of oil-seeds and therefore not liable to pay tax was not examined. From this the assessee is not aggrieved. But, while considering the alternative case that even if the assessee is held to be the first purchaser of oil-seed it was entitled to the concessional rate of 2 per cent as it held recognition certificate, the revising authority issued direction that as the oil produced by the assessee must be deemed to have flown from both the sources, that is, oil-seed purchased against recognition certificate and otherwise, the proportionate formula laid down by the Bombay High Court in Commissioner of Sales Tax v. Berar Oil Industries [1975] 36 STC 473 may be applied. The assessee is aggrieved against this direction. The occasion for direction arose as sale of oil was higher as compared to oil extracted from oil-seed purchased against recognition certificate and the assessee did not maintain separate account of oil extracted from oil-seed purchased against recognition certificate and otherwise. The be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt- (a) not less than the difference between the amount of the tax on the sale or purchase of such goods payable under section 3, section 3-A, section 3-AA or section 3-D as the case may be, and the amount of the tax payable at concessional rate under this section, where the goods are purchased after paying the tax at concessional rate, and (b) not less than the amount of the tax payable under section 3, section 3-A, section 3-AA or section 3-D as the case may be, where the goods are purchased without payment of the tax, but not exceeding three times the amount of such difference or of the tax, as the case may be. (6) Where a dealer in whose favour a recognition certificate has been granted under sub-section (2) has sold the notified goods otherwise than in the State of Uttar Pradesh or in the course of inter-State trade or commerce or in the course of export out of India or has despatched such goods to a place outside the State except as a direct result of sale or purchase in the course of inter-State trade or commerce or in the course of export out of India, such dealer shall be liable to pay an amount, which shall be equal to the difference between the amount of the tax on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f manufacturing notified goods may apply for a recognition certificate. The goods manufactured out of the raw material should, however, be intended to be sold in the State or in the course of inter-State trade or commerce. The words "such notified goods" are important. The requirement of selling in the State or in the course of inter-State trade or commerce is confined to such notified goods as are manufactured out of raw material obtained against the recognition certificate, and not to notified goods manufactured otherwise. In sub-section (6) the words "notified goods" have to be understood in the same sense as in sub-section (2), that is, such notified goods as are manufactured out of raw material purchased against the recognition certificate. A reading of these two subsections together, therefore, hardly leaves any room for doubt that breach so as to disentitle an assessee from claming the benefit of concessional rate of tax should be in respect of goods manufactured out of raw material purchased against the recognition certificate. The reason is obvious. If a particular goods has been notified it shall continue to be so whether it is manufactured as provided in sub-section (2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion certificate and the remaining was manufactured out of oil-seed purchased otherwise. In this view of the matter, the principle of determining liability on proportional extraction and sale does not arise. The learned standing counsel has placed strong reliance on the Bombay decision, which has been the inspiration for the direction by the revising authority. It is, therefore, necessary to examine it. The facts of the case mentioned at page 475 are as under: "During the assessment period the respondents sold goods for the aggregate price of Rs. 2,50,00,145. Out of these total sales, sales of the aggregate value of Rs. 1,40,97,329 were in accordance with the declaration made by the respondents in the certificates in form 15 given by them while purchasing the raw materials, while sales of the aggregate value of Rs. 1,09,11,816 were sales not in accordance with such declaration, that is, had the raw materials which had gone into the manufacture of such goods been purchased against certificates in form 15, the said sales would have been contrary to the declaration made in such certificate. For the sake of convenience we will refer to the first, type of sales, namely, sales where ..... X X X X Extracts X X X X X X X X Extracts X X X X
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