9911796707
TMI Blog1996 (5) TMI 405X X X X Extracts X X X X X X X X Extracts X X X X ..... time of purchase, sales tax is paid to the seller at the rate of 2 per cent or 4 per cent as the case may be, together with the forward declaration forms under the 41 Act. Necessary returns were filed for the quarter ending June 30, 1993 claiming deduction under section 5(2)(a)(va) and for the quarter ending September 30, 1993 under section 5(2)(a)(vd) of the 41 Act. Such claims were made since Hamilton poles are nothing but strips in a rolled and riveted condition and both the raw materials used and the manufactured goods are declared goods falling within the same sub-clause, namely, section 14(iv)(vi) of the 56 Act. Since tax has been paid already on strips, no tax is payable on the sale of Hamilton poles in terms of section 15(a) of the 56 Act. On the sale of pipes and tubes, the claim was made on the ground that pipes and tubes are manufactured out of H.R. coil, C.R. coil, skelp, strips and sheets and all these items fall within section 14(iv) of the 56 Act. However, the respondent No. 1 refused to issue declaration forms against the purchase of raw materials when applied for after verifying the returns on the ground that the applicant is not entitled to claim exemption under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he fact that pipes and tubes and H.R. coil, C.R. coil, sheet, strip and skelp from which they are manufactured fall under different sub-clauses of section 14(iv) of the 56 Act, no tax can be levied on the sale of the pipes and tubes, being declared goods, once tax is paid on the H.R. coil, C.R. coil, skelp, sheet and strip. It is a wellsettled principle of law that no tax is payable on the sale of goods specified under section 14(iv) of the 56 Act if the said goods are manufactured out of the purchase of declared goods specified in that section on payment of tax provided they fall within the same sub-clause of section 14(iv) of the 56 Act. Hence, the claims under section 5(2)(a)(va) and 5(2)(a)(vd) are justified and cannot be rejected. 4.. In their affidavit-in-opposition, the respondents have pleaded that the contentions of the applicant are based on a wrong understanding of the law. The restriction of section 15(a) of the 56 Act will apply only if the new commercial commodity produced falls in the same sub-clause of section 14(iv) of the 56 Act as that of the raw materials used as held by the Supreme Court in the case of Pyare Lal Malhotra [1976] 37 STC 319 and Telangana Steel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the admitted position that the raw materials used, namely, H.R. coils, C.R. coils, skelp, strips and sheets, used in the manufacture of pipes, tubes and Hamilton poles are declared goods, falling under sub-clause (vi) of clause (iv) of section 14 of the 56 Act and have been subjected to tax at the rate of 2 per cent or 4 per cent, as the case may be, at the time of purchase. The dispute is on the question whether the goods manufactured by the applicant, namely, pipes tubes and Hamilton poles, can be said to be declared goods and, if so, eligible for exemption from tax at the time of their sale. 7.. The first contention of Mr. P.K. Pal, the learned advocate for the applicant, is that under section 5(2)(a)(va) of the 41 Act, deduction from gross turnover has been allowed on the sale of goods specified in section 14 of the 56 Act on a prior sale wherever in West Bengal due tax is shown to have been paid. Section 14(iv) of the 56 Act refers to iron and steel and has proceeded to enumerate 16 categories by way of illustration, which is the meaning of the words that is to say , used after the words iron and steel in section 14(iv) of the the 56 Act. Therefore, so long as both the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e benefit of single point taxation subject to a minimum of 4 per cent as envisaged in section 15(a) of the 56 Act will apply only if both the raw materials used in the manufacture and the finished products are declared goods falling within the same sub-clause of section 14(iv) of the 56 Act. 9.. According to us, there is no scope for any doubt as to the meaning of iron and steel as used in section 14 of the 56 Act after the landmark judgment of the Supreme Court in the case of State of Tamil Nadu v. Pyare Lal Malhotra reported in [1976] 37 STC 319, which has been followed in numerous decisions since including the judgment of this Tribunal in the case of Hindusthan Wires Limited v. Commercial Tax Officer, Assessment Wing reported in [1995] 97 STC 652; (1994) 27 STA 190. Since Mr. Pal has, nonetheless, chosen to raise this point, we can do no better than quote the following observations of the Supreme Court at pages 324-325 of that judgment: .............The ordinary meaning to be assigned to a taxable item in a list of specified items is that each item so specified is considered as a separately taxable item for purposes of single point taxation in a series of sales unless t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Now, the question remains whether the pipes, tubes and Hamilton poles manufactured by the applicant are declared goods and if so, fall in the same sub-clause of section 14(iv) of the 56 Act which cover the raw materials for their manufacture. The admitted position is that the raw materials, namely, H.R. coil, C.R. coil, strips, skelp and sheets fall within sub-clause (vi) of clause (iv) of section 14 of the 56 Act. Mr. Pal has contended that Hamilton poles are nothing but sheets in rolled and riveted condition and, therefore, fall in the same subclause. He has not made any such claim regarding galvanized pipes and tubes but has merely described them as falling within section 14(iv) without pinpointing any particular sub-clause to which they belong. Mr. Pal also drew our attention to the following observation of the last fact finding authority, namely, the Deputy Commissioner, at page 3 of his order dated November 30, 1994 which reads thus: ............Apart from iron and steel tubes and pipes, the petitioner also sold steel tubes more commonly known as Hamilton poles which is manufactured by rolling and riveting steel sheets........... Citing the decision of the Supreme C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inished and sold as different goods, e.g., bends, pipes, manhole covers, motor parts, etc., will still be treated as cast iron, the test being whether the goods are being dealt as cast iron or as different goods made out of cast iron in the market place. 12.. Applying the logic of the above case to the case before us, we note that the goods in question, namely, pipes, tubes and hamilton poles do not find any mention in sub-clause (vi) of clause (iv) of the 56 Act, which reads as follows: ...................... (vi) sheets, hoops, strips and skelp, both black and galvanised, hot and cold rolled, plain and corrugated, in all qualities in straight lengths and in coil form, as rolled and in riveted condition. It is not even the case of the applicant that pipes and tubes fall in this subclause, his contention being that they do not fall under sub-clause (xi) and that they are declared goods within the meaning of section 14(iv) without reference to any of the sub-clauses. Since we have already rejected this contention, it has to be held that pipes and tubes are not declared goods at all under any of the sub-clauses of section 14(iv). As far as Hamilton poles are concerned, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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