9911796707
TMI Blog1995 (4) TMI 253X X X X Extracts X X X X X X X X Extracts X X X X ..... Act") as also under the Central Sales Tax Act, 1956. A controversy had arisen regarding true ambit and scope of expressions "manufacture" and "resale", as defined in section 2(16) and 2(26) of the Act respectively read with section 7 and item 3 of Part A of Schedule II of the Act and rule 3(xvii) of the Gujarat Sales Tax Rules, 1970 (hereinafter referred to as "the Rules"). According to the department, on correct interpretation of item No. 3 of Schedule II-A read with rule 3(xvii) on iron and steel, if some process is carried out, the product would fall within the term "manufacture" as defined in section 2(16) of the Act. According to dealers, however, if on such process, the resultant product is not taken out of entry 3, such product would not be regarded as manufacture and continue to fall under the definition of "resale" under section 2(26). Thus, the controversy was as to whether the item of iron and steel on which process is carried out would fall within sub-section (16) of section 2 or sub-section (26) of section 2 of the Act. It appears that the Gujarat Sales Tax Tribunal held that even after the process if the resultant product is not taken out from the description of item ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de purchases by saving tax at the time of purchase by tendering forms'LL','OO' according to the notification, entry No. 86, issued under section 49 on the sale of articles manufactured out of such purchases, assessment should be made and in respect of the purchase made against this form, no proceedings be initiated." Keeping in mind the above instructions, the cases were ordered to be disposed of. Subsequently the Gujarat Sales Tax Act came to be amended with effect from April 1, 1992 and the definition of "resale" in section 2(26) came to be substituted. However, in the present proceedings we are not concerned with the amendment inasmuch as the question raised in the present proceedings relates to the assessment year 1991-92. According to the petitioner from the circular issued by the department, it was clear that the decision in Mohta Ispat Ltd. [1992] 87 STC 125 (Guj) was accepted by the department. Therefore, in accordance with the above decision as also the circular, the petitioner treated itself as manufacturer for a period between April 1, 1991 to September 30, 1991 and for the remaining period between October 1, 1991 to March 31, 1992 as reseller buying goods after payi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er section 16 and penalty will be imposed under section 45(1). For such purchases without form, refund will be given under rule 42." According to the petitioner, therefore, during the intervening period the department clarified its position by stating that it would treat a dealer either as "manufacturer" or as "reseller " according to how the dealer himself has treated his activity. If he treated himself as "manufacturer", he would be assessed as "manufacturer" and if he has treated himself as "reseller", he would be treated as "reseller". In course of the assessment proceedings two questions arose in connection with the assessment of the petitioner. Firstly as regards liability of the petitioner to pay additional purchase tax under section 15B and secondly regarding levy of purchase tax under section 16 for violation of form No. 19 for zinc and other items. With regard to the first question it is the contention of the petitioner that the point was finally concluded by a decision of this Court in Mohta Ispat Ltd. [1992] 87 STC 125 as also the circular issued by the department. Though legal position was amply clear the respondent-authorities committed an error of law in passing th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6)(iii) in terms of decision of this Court in Mohta Ispat Ltd. [1992] 87 STC 125. The first contention of Mr. Kaji, therefore, must be accepted. So far as second point is concerned, in our opinion, it cannot be said that the third respondent has committed any error in not accepting bald assertion of the petitioner regarding violation of form No. 19. No doubt, it is contended by the petitioner that he has not committed breach of any provision of law and zinc purchased by the petitioner against form No. 19 was utilised only for galvanised steel pipes which were sold in the State of Gujarat and the third respondent could not have levied purchase tax thereon. But no materials, whatsoever was placed on record in support of the said assertion. In absence of necessary materials and evidence, it was open to the third respondent not to accept the case of the petitioner and to pass an appropriate order in accordance with law. In fact after considering the submissions of the petitioner, it was observed as under: "This submission of the dealer has not been accepted because in such purchases identification is not possible and taking into consideration the aforesaid, purchase tax under secti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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