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TMI Blog1986 (2) TMI 327X X X X Extracts X X X X X X X X Extracts X X X X ..... roof packing of the goods. The Government of Uttar Pradesh issued a notification dated 31st December, 1976 (annexure 1 to the writ petition) (hereinafter referred to as "the notification"), clause 2 of which provides inter alia, that no tax shall be payable on the sales or purchases by any unit in respect of raw materials required by it for the use in the manufacture of the goods, mentioned in annexure III, as referred to in clause 2 of the notification. Item No. 4 in annexure III as referred to in clause 2 of the above notification is as under: "4. All kinds of packing materials including cases and containers." So, the case is that the manufacturing unit of the petitioner being engaged in the manufacture of packing material is entitled to full exemption of tax on the purchase of raw materials within the meaning of clause 2 of the notification, that the petitioner was granted a recognition certificate as such under section 4-B of the Act, which is annexure 2 to the writ petition, in May, 1976, and that the petitioner continued to avail the exemption thereafter. A show cause notice dated 5th September, 1985, was received from the respondent No. 2 by the petitioner calling upon i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The short question for consideration in this writ petition is whether the manufacturing activity of the petitioner can be held to be the manufacturing of paper within the meaning of clause 3 of the notification and whether the petitioner can be said to carry out manufacture of "packing materials" within the meaning of item 4 of annexure III, as referred to in clause 2 of the notification? Clause 2 of the notification declares that no tax shall be payable on the purchase by any unit in respect of raw materials required by it for the use in the manufacture of the goods mentioned in annexure III. The contention of the petitioner is that it is engaged in the manufacture of packing materials, as envisaged by item 4 of annexure III as referred to in clause 2 of the notification and, therefore, no tax is leviable on purchase of raw materials required in the manufacture of packing materials. It is undisputed that a recognition certificate (annexure 2) was granted to the petitioner and benefit of exemption of tax has been availed by the petitioner under the certificate. The case as set up in the counter-affidavit is that the petitioner is not engaged in the manufacture of packing materia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r which a paper is ordinarily used. The product of the petitioner can be used only for a specific purpose, i.e., for waterproof packing. The matter may be looked at from another angle also. The product of the petitioner has three components, namely, craft paper, bitumen and hessian or polythene. For the petitioner, it was stated that it does not manufacture craft paper. The other two components have no semblance of paper. So one of the components, which is paper, is also not manufactured by the petitioner. So, looking to the actual manufacturing, it cannot be said that the petitioner is engaged in the manufacture of paper. There is a trite law that in the matters of taxation or specially when there is a question whether a given classified item is entitled to the benefit of tax exemption, technical or dictionary meaning should not be resorted to, but the decision should turn on as to how it is regarded in the commercial world in common parlance. In commercial world, there is different section of traders who deal in the product in question and such product is not available with the dealers, who are ordinarily engaged in the sale or purchase of paper. So, neither in common parlanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd, therefore, this is not a fit matter in which either a writ of prohibition or any other writ can be issued. We are not impressed by this argument at all. Annexures 4 and 5 to the writ petition are the circulars issued by the Commissioner of Sales Tax. The case of the petitioner is that the respondent No. 2 caused the notice (annexure 3) to be served on the petitioner following the aforesaid circulars. The learned standing counsel adhered to these circulars before us and argued that the circulars were rightly issued and the petitioner being engaged in the manufacture of paper, is not entitled to the benefit of tax exemption on purchase of raw materials. In these circumstances, the order of the respondent No. 2 is a foregone conclusion. The circulars of the Commissioner being binding on the respondent No. 2, he cannot deflect from them and there would be an order against the petitioner. So, giving reply to the respondent No. 2 against the notice will be an idle formality and the petitioner will not be benefited in any way. Moreover, the question is whether the petitioner is entitled to a writ of prohibition when the respondent No. 2 does not have the jurisdiction to issue the im ..... X X X X Extracts X X X X X X X X Extracts X X X X
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