9911796707
TMI Blog1993 (4) TMI 292X X X X Extracts X X X X X X X X Extracts X X X X ..... boring and machining the goods. Steel cast grinding media are known as hyper steel cast grinding media in the form of balls or cylindrical copper ore, zinc ore and iron ore, used for crushing limestone, cement and coal (vide paragraph 1 of the writ petition). After reproducing the meaning of "cast" and "casting" from four dictionaries, the applicant proceeded to state that "ingot" means any mass iron cast in a mould. Even if molten iron is cast on a cylindrical surface, the product taking a tubular shape, it would be nothing but "cast iron". Allegedly, cast iron as a species of the genus of "iron and steel" would include all things, whatever be the name or brand, made by melting cast iron and by casting the same in any shape, form or design. During the period from July 1, 1966 to June 30, 1975, the rate of tax for declared goods under section 14 of the Central Sales Tax Act, 1956 (hereinafter referred to as "the 1956 Act") was 3 per cent leviable only at a single stage. By a letter dated December 14, 1976, the Department of Heavy Industries, Government of India, clarified to the applicant that steel casting and forged iron and steel grinding media are all covered by the expression ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd spun pipes. From that appellate order, the applicant filed a revision before respondent No. 1, the West Bengal Commercial Taxes Tribunal. But the Tribunal below also held that grinding media and spun pipes made of cast iron were different commercial commodities and were not covered by any of the entries of section 14(iv) of the 1956 Act, thereby attracted general sales tax. Hence the writ application. 3.. The case has been resisted by the respondents who filed an affidavitin-opposition. They alleged that the identity of the manufactured products differed from that of the raw materials or goods out of which those were manufactured. Different commercial commodities allegedly came into being. No importance should be attached to the letter of the Department of Heavy Industries of the Government of India on which the applicant puts reliance, because that department was not responsible for administering the Central Sales Tax Act, 1956. Relying on the decision of the Supreme Court in the case of State of Tamil Nadu v. Pyare Lal Malhotra [1976] 37 STC 319; AIR 1976 SC 800, on which the applicant also relied, the respondents contended in the affidavit-in-opposition that the items lik ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the 1956 Act and, therefore, could not be subjected to sales tax once again, provided sales tax had been imposed at an earlier stage on the same goods within West Bengal. 5.. It may be noted that Dr. Pal, appearing for the applicant, did not press the claim with regard to products such as sleeve, gear, hammer, etc. In other words, at the time of hearing the applicant abandoned the claim with regard to the above items. Therefore, Mr. T.N. De, learned State Representative, did not argue the case of the respondents on those items. It may be noted that these items are made of steel castings and the applicant had originally claimed the benefit of section 14(iv)(viii) of the 1956 Act on the plea that these continued to remain steel castings. This was not pressed by Dr. Pal. In passing, however, Mr. T.N. De, learned State Representative, only mentioned that in the case of Bengal Ingot Co. Ltd., decided on March 9, 1990, reported in [1990] 79 STC 212 it was held by this Tribunal (we were parties to that judgment also) that since the assessee had failed in that case to prove that in commercial parlance alloy steel castings such as rings, bushes, impellers, check valves, and the like were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed January 4, 1971 from Garden Reach Workshops Limited addressed to the applicant and quotation dated May 17, 1973, submitted by the applicant to the Garden Reach Workshops Limited and also bill No. Si.-572 dated August 23, 1973, of the applicant to the Garden Reach Workshops Limited. But all these papers referred to steel castings by the name of clutch shifter fork. Therefore, these papers have nothing to do with purchase and sale of grinding media. It has not been explained whether clutch shifter fork has any relation with grinding media. The applicant also furnished photo copy of Indian Standard Specification for low alloy steel grinding media (first revision). It appears from the same that low alloy cast steel grinding media are used in cement, mineral crushing, chemical, pharmaceutical and allied industries". It further appears that "grinding media shall be accurately moulded in accordance with the size and tolerances specified in the standard, or as agreed to between the purchaser and the manufacturer". I.S. specifications mentioned that the chemical composition will consist of carbon, silicon, manganese, chromium, sulphur and phosphorus, apart from steel. The specifications ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... took over the control of industries manufacturing or producing iron and steel castings and forgings. The object of the Central Sales Tax Act, 1956, is quite different. By section 15 of that Act, the Parliament has laid down restrictions of imposition of tax by the States on the goods declared under section 14. Accordingly, the letter dated December 14, 1976, of the Department of Heavy Industries, Government of India stating that steel castings/ steel grinding media are covered by item 1A(3) is of no significance for the purpose of the present controversy. The letter merely indicates that industries manufacturing or producing steel grinding media are also under the control of the Central Government in accordance with the provisions of the aforesaid Act of 1951. 8.. In paragraph 6 of the writ application the applicant stated that grinding media are also subjected to levy of duty under the Central Excises and Salt Act, 1944, in terms of entry T.C. 26AA(v) as steel casting. It may be mentioned in this connection that section 14 of the 1956 Act deals with declared goods and clause (iv) of section 14 deals with various descriptions of iron and steel. But item 26AA of the First Schedul ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expression, "that is to say" has been interpreted by the Supreme Court, in the case of Pyare Lal Malhotra [1976] 37 STC 319 (SC); AIR 1976 SC 800, in the following words: "The purpose of an enumeration in a statute dealing with sales tax at a single point in a series of sales would, very naturally, be to indicate the types of goods each of which would constitute a separate class for a series of sales. Otherwise, the listing itself loses all meaning and would be without any purpose behind it." The Supreme Court further observed at pages 324 and 325 of the Report (at pages 804 and 805 of AIR): "If the object was to make iron and steel taxable as a substance, the entry could have been: 'Goods of iron and steel'. Perhaps even this would not have been clear enough. The entry, to clearly have that meaning, would have to be: 'Iron and steel irrespective of change of form or shape or character of goods made out of them'. This is the very unusual meaning which the respondents would like us to adopt. If that was the meaning, sales tax law itself would undergo a change from being a law which normally taxes sales of 'goods' to a law which taxes sales of substances out of which goods are m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the sales tax law, it may also become necessary to consider whether a manufacturing process, which has altered the identity of the commercial commodity, has taken place. The law of sales tax is also concerned with 'goods' of various descriptions. It, therefore, becomes necessary to determine when they ceased to be goods of one taxable description and become those of a commercially different category and description. It appears to us that the position has been simplified by the amendment of the law, as indicated above, so that each of the categories falling under 'iron and steel' constitutes a new species of commercial commodity more clearly now. It follows that when one commercial commodity is transformed into another, it becomes a separate commodity for purposes of sales tax." 10.. The aforesaid decision in the case of Pyare Lal Malhotra [1976] 37 STC 319 (SC); AIR 1976 SC 800 and the observations in [1967] 20 STC 430 (SC) (Devi Dass Gopal Krishnan v. State of Punjab) followed in that case lay down the principle that if a new commercial commodity emerges out of a process of manufacture, it will be subjected to sales tax as the new commodity and not as belonging to the cat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly 29, 1983. It appears from an order recorded on July 25, 1985, that the interim order had lapsed due to passage of time. By an order dated May 19, 1989, the interim order was extended in this Tribunal. 13.. In the result, the writ application is allowed in part. The spun pipes made of cast iron will be treated as cast iron castings or cast iron within the meaning of section 14(iv)(i) of the Central Sales Tax Act, 1956 and to that extent, the impugned assessment order for the period of four quarters ending September 30, 1973 and the orders passed by the Assistant Commissioner in the appeal and the Tribunal below in the revision are modified. The writ application is allowed in part only to that extent. The Commercial Tax Officer, respondent No. 3 is directed to modify his assessment order accordingly. The writ application is dismissed in respect of sleeve, gear, hammer, etc., and also in respect of steel grinding media. The assessment order and the order of the Appellate Assistant Commissioner and the Tribunal below are confirmed in these respects. The interim order will stand vacated. There will be no order for costs. P.C. BANERJI (Technical Member).-I agree. Writ applicatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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