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TMI Blog1990 (9) TMI 338X X X X Extracts X X X X X X X X Extracts X X X X ..... r is a dealer registered under the Madhya Pradesh General Sales Tax Act, 1958. He is also a forest contractor. He purchased standing trees from forest coupes and paid full sales tax on these transactions. When the assessee s turnover for the Diwali year 1972-73 was being assessed for purposes of sales tax, he claimed that the tax-paid by him on purchase of standing trees from the forest department should be set off against the sales tax assessed. Its contention was that the entry in its registration certificate mentions timber and that would cover standing trees also. The entry in the registration certificate was modified after May 7, 1973 to include standing trees also. The assessing authority as also the appellate authority rejected the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are attached to the land may be the subject-matter of contract of sale provided that under the terms of the contract of sale they are severed before the sale or under the contract of sale. Since the goods as defined in Bombay Sales Tax Act, included all standing timber which are agreed to be severed before the sale or under the contract of sale, the Supreme Court held timber to be goods within the meaning of section 2(7) of Sale of Goods Act, and since the expression sale of goods in entry 54, List II of Seventh Schedule has the same meaning as that expression has in the Sale of Goods Act, sale of timber agreed to be severed under the terms of the contract may be regarded as goods and was held to be sale of goods. The statement of cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and tree the dictionary meaning, i.e., wood suitable for building houses, bridges, ships, etc., whether on the tree or cut and seasoned was accepted and it was held that standing timber must be a tree in a state fit for these purposes and, further a tree that is meant to be converted into timber so shortly that it can already be looked upon as timber for all practical purposes even though it is still standing. Reference may also be made to a decision of the Supreme Court, in State of Orissa v. Titaghur Paper Mills Co. Ltd. [1985] 60 STC 213; AIR 1985 SC 1293, wherein dealing with the provisions of Orissa Sales Tax Act, one of conclusions as summarized in paragraph 127 of the report, is that under the timber contracts the property i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stance of those opinions, reached the conclusion as aforesaid. This Court also, in Mohanlal Vishram v. Commissioner of Sales Tax, M.P. [1969] 24 STC 101, opined that by felling standing timber trees, cutting them and converting some of them into ballis, the character of the goods is not altered and the goods still continue to be timber . 6.. From the aforesaid discussion, it can well be inferred that a tree that is meant to be converted into timber shortly can well be looked upon as timber for all practical purposes even though it is still standing. This will be particularly so in case of timber contract where the property passes when they are felled, that is, in timber. In the instant case also, as appears from statement of case drawn b ..... X X X X Extracts X X X X X X X X Extracts X X X X
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