9911796707
TMI Blog2000 (8) TMI 1087X X X X Extracts X X X X X X X X Extracts X X X X ..... 5 per cent falling under entry 3-A of the First Schedule to the Tamil Nadu General Sales Tax Act, 1959. The assessing authority held that according to the sales invoices, the assessee manufactured covers for carbon elements used in battery cells and these covers act as separators of the carbon elements also and therefore the turnover of Rs. 6,31,161.25 is assessable to tax at 15 per cent as sale of battery covers. 2.. In the first appeal, the Appellate Assistant Commissioner held that for the previous year, the Appellate Tribunal has held that plastic covers used for covering carbon elements of AWC 2 cells are liable to tax at multipoint and therefore following the above decision, the commodity has to be assessed to tax at multi-point o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mary cells, there is no feasibility' of re-chargeability. However, storage battery cells covered by entry 3-A of the First Schedule to the Act are rechargeable batteries. While caustic soda is used as electrolyte in AWC 2 cells, sulphuric acid is used as electrolyte in storage batteries. Similarly lead and lead oxide are used as electrodes in storage batteries and carbon and zinc are used as electrodes in AWC 2 cells. While plastic or rubber is used as container in storage batteries, glass container alone is used in AWC 2 cells. 5.. Further, the plastic covers sold by the assessee have been used for covering carbon elements in the cells. Therefore the plastic covers themselves are not covers for the ultimate product, namely, AWC 2 cells s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the motor vehicle. This decision was followed by the Allahabad High Court in the decision reported in [1994] 95 STC 490 (Motor Industries Company Ltd. v. State of U.P.) while considering whether fuel injection equipment which is a component part of diesel engine could be considered as a part of motor vehicle. These decisions are not relevant to the present case on hand inasmuch as the carbon electrode of which the plastic cover forms a component part is nothing but a part of the AWC 2 cells sold by the assessee for the reasons as indicated earlier. The plastic cover also functions as a separator in the AWC 2 cells as already pointed out. However the vital point for consideration is whether the AWC 2 cells sold by the assessee are storage b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e cell" is defined as elect. a cell whose energy can be renewed by passing a current through heat in the direction opposite to that of the flow of current generated by the cell. Also called secondary cell, storage battery. Similarly the word "cell" is defined in the Reader's Digest Great Encyclopaedic Dictionary, Second Edition, Volume Three, as follows: Cell: Fuel device which converts fuel directly into electrical energy; primary, assembly of 2 electrodes of dissimilar conductors immersed in an electrolyte, chemical action results in a potential difference between the electrodes, and the cell will supply current, components of the primary cell eventually deteriorate and must be discarded, and replaced. See Leclanche Cell; Daniell Cell Sec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... called a secondary cell is rechargeable by passing a reverse direct current through the cells. However in a primary cell like that of the assessee's product of AWC 2 cell, the components deteriorate by usage and they must be discarded in short, the primary cells are not rechargeable. Thus, in commercial parlance, the storage batteries which are secondary cells are different commodities from primary cells or batteries. It is quite clear that the assessee sold only batteries of primary cells and therefore such goods cannot be classified as storage batteries. AWC 2 cells are batteries which cannot be recharged, but should be discarded after usage. Thus, we find force in the arguments of the learned Counsel for the respondent/ assessee that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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