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TMI Blog1993 (10) TMI 332X X X X Extracts X X X X X X X X Extracts X X X X ..... bad (West), annexure PI. Thereafter a show cause notice was issued to the petitioner on February 2, 1993(?), annexure P2. The petitioner replied the same vide annexure P3. The petitioner, before the assessment order was passed, submitted written arguments and the copy of which was produced with the writ petition (annexure P4). In order to explain the position, copy of delivery challan, annexure P5, and bill, annexure P6, were produced. The writ petition was filed challenging the impugned order dated March 9, 1993, annexure PI and demand notice dated March 18, 1993, annexure P7. When the matter came up before the Motion Bench it was represented that after the omission of clause (vii) of proviso to section 15(1) of the Act charging of sales tax on jute bags at the rate of 12 per cent was not permissible under the law. On notice of motion having been issued, on behalf of the respondents reply has been filed by the Excise and Taxation Officer concerned, inter alia, asserting that while selling the cement contained in the gunny bags consolidated price was charged on which sales tax at the rate of 12 per cent was rightly assessed. The petitioner could not bifurcate transaction in two par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se of liquor (foreign liquor and Indianmade foreign liquor) specified at serial number 25 of Schedule A and (twelve paise) in a rupee in the case of other goods specified therein; and (b) (eight paise) in a rupee in the case of other goods; as the State Government may, by notification, direct." The aforesaid provision contained different provisos. Proviso (vii) read as under: "(vii) In the case of sale of goods packed in jute bags, the value of such bags, whether charged separately or not, shall be charged at the rate at which such goods are taxable." Proviso (vii) as reproduced above, was omitted from the principal Act by Haryana Act 13 of 1988 which came into force on April 11, 1988. Thus, for the assessment year in question it is to be taken that clause (vii) as reproduced above did not exist in the principal Act. It was on account of proviso (vii) that value of the goods as well as of the bags in which goods were packed, were to be clubbed and was chargeable to sales tax at the rate at which such goods were taxable. There is no dispute that the sale of cement was subjected to tax at the rate of 12 paise in a rupee, prior to the repeal aforesaid. The contention of Shri Moh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat the weight of the bag is included in the price to be charged by the dealer. Under the explanation when packing is done in cloth bags, a higher rate is admissible. The scheme clearly suggests that the price of gunny bags is inclusive and where cloth bag is used, a higher price over and above what has been provided for ordinary containers is permitted." Reference was made to the earlier decision in Hyderabad Deccan Cigarette Factory v. State of Andhra Pradesh [1966] 17 STC 624 (SC) wherein it was observed as under: "In a case of this description what the sales tax authorities had to do was to ask and answer the question whether the parties, having regard to the circumstances of the case, intended to sell or buy the packing materials or whether the subject-matter of the contracts of sale was only an exempted article (here exigible to tax at radical rate), and packing materials did not form part of the bargain at all, but were used by the sellers as a convenient and cheap vehicle of transport." On the other hand, Mr. Arun Nehra, Additional Advocate-General, Haryana, has relied upon the decision of the Supreme Court in Raj Sheel v. State of Andhra Pradesh [1989] 74 STC 379. Wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... using the product with respective sale considerations for the product and the container separately; or it may consist of a sale of the product and a sale of the container but both sales being conceived of as integrated components of a single sale transaction; or, what may yet be a third case, it may consist of a sale of the product with the transfer of the container without any sale consideration therefor. The question in every case will be a question of fact as to what are the nature and ingredients of the sale. It is not right in law to pick one ingredient only to the exclusion of the others and deduce from it the character of the transaction." It was further observed as under: "In every case, the assessing authority is obliged to ascertain the true nature and character of the transaction upon a consideration of all the facts and circumstances pertaining to the transaction. The problem always requires factual investigation into the nature and ingredients of the transaction." The other case relied upon on the subject is of the honourable Supreme Court in Commissioner of Sales Tax v. Rai Bharat Das Bros. [1988] 71 STC 277. That was a case of sale of sand packed in sound gun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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