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TMI Blog1986 (7) TMI 385X X X X Extracts X X X X X X X X Extracts X X X X ..... ccounts maintained but the Assessing Authority was of the view that in accordance with the instructions issued by respondent No. 1, the coal briquettes may be taxed at the rate of 8 per cent instead of 4 per cent. The explanation given by the petitioner was not accepted and the Assessing Authority imposed tax on coal briquettes at the rate of 8 per cent instead of 4 per cent. Through this petition, the petitioner has challenged the imposition of tax at the rate of 8 per cent and has also called in question the legality of enhanced demand of tax made on the basis of the imposition of tax at the rate of 8 per cent. On 10th July, 1985, on the basis of the judgment in Khanna Coke Industries, Moradabad v. Assistant Commissioner (Judicial), Sales Tax, Moradabad (printed at page 335 infra); 1978 Tax LR 2129 (All.) the case was admitted and was ordered to be heard at an early date. Written statement has been filed on behalf of respondents Nos. 1 and 2, in which some preliminary objections have been taken. On merits, the action is sought to be supported on the plea that the briquettes is not coal and this is not covered by item (ia) of section 14 of the Central Act, but it is a different ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used as coal, that it is a matter of common knowledge that the coal briquettes manufactured by the assessee are meant for domestic kitchen consumption and that a fair inference can be drawn that the briquettes manufactured by resorting to a mechanical process are used for the same purpose as coal or coke. According to the learned counsel, coal briquettes manufactured by the assessee would certainly fall within the definition of "coal" and that coal briquettes are covered by the definition as given in item (ia) of section 14 of the Central Act. After giving our thoughtful consideration to the entire matter, we find force in the contention of the learned counsel for the petitioner. Coal briquettes are manufactured by the assessee by mixing coal-dust with molasses and clay. The coal briquettes are used for domestic kitchen consumption. In other words, it can fairly be said that the coal briquettes can be used for some such purposes for which coal is used. The raw material used in manufacturing the briquettes is the residue of small particles of coal which are generally called as coal-dust. The coal-dust which is used for preparing the briquettes has independently the properties whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l its forms'." At this stage, I may refer to a judgment of the Madras High Court in Deputy Commissioner of Commercial Taxes, Madras Division v. B.R. Kuppuswami Chetty [1980] 45 STC 308. In that case, the assessee was a firm dealing in leco, firewood and charcoal. There was a dispute as to the classification of leco. According to the assessee, leco being carbonised lignite briquette was coal which is declared as goods of special importance in inter-State trade and commerce under section 14(i) of the Central Act. If leco is taken as declared goods, then the assessee's sale would be second sales which are not taxable. The assessing authority declined to grant this exemption and the Appellate Assistant Commissioner confirmed the assessment. The Tribunal, after going elaborately into the question of manufacture of lignite briquettes and also other aspects of the matter, came to the conclusion that leco was declared goods under section 14(i) of the Central Act. In fact, the Tribunal held that leco was only lignite which is a variety of coal and which was liable to be taxed only on first sale. The question that arose for consideration was whether leco is coal or charcoal. After making re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Court under similar circumstances and in view of the factual situation that leco in common parlance is fuel, we are unable to appreciate as to how and in what respect the order of the Tribunal is wrong'. ...........We may also point out that the process which goes to the manufacture or making of lignite briquette is the same as employed for the purpose of obtaining coke and that is how the Central Government had understood lignite briquettes as coming within the scope of the term coke used in the Act." The aforesaid observations again fully support our view taken on the point debated before us. Before parting we may advert to the judgment of the Madras High Court in K. Venkataraman and Company v. State of Tamil Nadu [1971] 28 STC 426, to which reference has been made in the written statement, wherein cinder has not been held to be covered by the definition of section 14(ia) of the Central Act. In our view that judgment is not at all helpful in holding that briquettes prepared from coke or coal do not fall within the definition of "coal". The meaning of word "cinder" as given in the dictionary is a piece of partly burned coal capable of further burning without flame, or in othe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct. On the finding that coke briquettes are manufactured by mechanically pressing the mixture of coal-dust, multani mitti and molasses, the Sales Tax Officer held it to be a product of coal and an unclassified item. The rate of tax under sub-section (2-A) of section 3-A of the U.P. Sales Tax Act in respect of goods other than those referred in sub-sections (1) and (2) of the section at the point of sale by manufacturer or importer is seven per cent. It is not disputed that coke briquettes are not mentioned in any schedule or notification issued by the State Government. Section 14(ia) of the Central Sales Tax Act reads as under: "14. It is hereby declared that the following goods are of special importance in inter-State trade or commerce: ........................... (ia) coal, including coke in all its forms, but excluding charcoal: .............................." This sub-clause came up for interpretation before the Supreme Court in India Carbon Ltd. v. Superintendent of Taxes, Gauhati [1971] 28 STC 603 (SC). The entry was held to be very wide. The view taken by the High Court that it must be coke which had been derived or acquired from coal by following the usual process of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from the material of which it is composed". Mere change of shape or structure in the raw material does not result in production of a new commodity. And even if it is so the entry is wide enough to cover in its fold commodities which remain the same despite change in shape. Coke briquettes thus being only a preparation of coke dust are covered by the expression "coke in all its forms". Relying on Delhi Cloth and General Mills v. R.R. Gupta, Commercial Tax Officer [1976] 38 STC 113 (SC); AIR 1977 SC 2086 the learned standing counsel has urged that the petitioner having an alternative and efficacious remedy by way of appeal and revision, this Court should refuse to interfere under article 226 of the Constitution of India particularly as it relates to interpretation of an entry in the Sales Tax Act which should be done by this Court under section 11(4) in its advisory jurisdiction. In the petitioner's case there is no dispute on facts. The process of manufacture indicated in the assessment order and the appellate order are not in question. Even if the matter comes to this Court by way of reference under section 11(4) of the Act, this Court shall answer the question of law on these ve ..... X X X X Extracts X X X X X X X X Extracts X X X X
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