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TMI Blog2006 (3) TMI 728X X X X Extracts X X X X X X X X Extracts X X X X ..... Menthol, (B) Distilled Water, (C) Water Menthol Mixture. 4. In the aforesaid certificate w.e.f. 29.10.1976, the following items have been added: 1. Generating sets, alternators, connectors, voltage establishes, transformer with related accessories. 2. Steel pipe, steel plate, steel reinforcement bars. 3. Insulators and seals, vent pipe, top & bottom ends. 4. Coalatar enamels. 5. Coaltar primer. 6. Fibre Glass. 7. Kraft paper. 8. PVC Tape. 9. Cathodie Protection Materials. 10. Oil and buch. 11. Control instruments. 12. Tale control and tale communication equipments. 5. In the aforesaid certificate w.e.f. 09.03.1973, the following items have been added: Laboratory equipment, implement, machinery plant, cranes, trolleys, conveyors, vehicle for transport of material from ware house to laboratory, accessories, spare parts, lubricants, fuel, glass ware, scales, chemicals, acids, electrical goods, air conditioner. 6. In the aforesaid certificate w.e.f. 18.06.1973, the following items have been added: Manufacturing purpose (1) Plant and machinery, (2) Laboratory Equipment, (3) Equipment and materials, (4) Tools and implement, (5) Locomotive and motor vehicle, (6) Fittings ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MABLE STORES WOODENSLEEPER 4311717 - - 811676 - CONSUMABLE LADDER 59550 - - - FITTING & FIXTURES R.C.C. PIPE 223200 83290 - - FITTING & FIXTURES KAMBALIBLANKE 247847 11875 - - 11. Assessing authority had not accepted the plea of the applicant and levied the penalty under Section 10-A of the Act. First appeals filed by the applicant were dismissed. Applicant filed second appeals before the Tribunal, which too have been dismissed by the impugned order. 12. Heard Sri Bharatji Agrawal, learned Senior Advocate, assisted by Sri Piyush Agrawal, learned Counsel for the applicant and Sri B.K. Pandey, learned Standing Counsel. 13. Learned Counsel for the applicant submitted that the aforesaid items are covered under the items mentioned in the registration certificate as per details provided. He submitted that in any view of the matter, applicant issued Form "C" under the bona fide believe that the aforesaid items were covered under the items mentioned in the registration certificate. Thus, there was no case of false representation. He submitted that unless a case of false representation is made out, penalty under Section 10-A of the Act was not leviable. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used for extracting water from building and filling sheds. 7. Kambal (Blanket) It is used by chaukidars in night duty. 8. Vessels - It is used for filling of LPG tank. It is claimed to be covered under the item steel plate. 9. Cement It is used in the construction of building. 10. Yarn - It is used as safety cap of cylinders. It is covered under consumable stores. 11. Trailer - It is used for transporting the gas cylinders from one place to another place. It is covered under motor-vehicle. 12. Hospital Equipment - It is used as hospital equipments and is covered under consumable stores. 13. Transmitter - It is used for measurement while filling the petroleum product in tanks and lorry. 14. Fire Fighting Pump - It is used for safety. It is covered under the consumable stores. 15. Cement Paint - It is used for painting of building filling shades etc. It is covered under consumable stores. 16. Film - It is X-ray films. It is used for the testing of pipe line. It is covered under the consumable stores. 17. G.I. Wireness - It is used for the safety of boundary wall. It is covered under the consumable stores. 18. Seal - It is used for the filling of carks of RCC flooring. It ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, accessories, fuel or lubricants, in the manufacture or processing of goods for sale or in mining, or in the generation or distribution of electricity or any other form of power. 19. Contents of declaration in Form "C' are as follows: The Central Sales Tax (Registration and Turnover) Rules, Form-'C' Form of Declaration [See Rule 12(1)] Name of issuing State.... Office of issue.... Date of issue.... Name of the purchasing dealer to whom issued alongwith his Registration certificate No.... Date form which Registration is valid.... Seal of Issuing Authority Serial No.... To, ....(seller) () Certified that the goods ** ordered for in our purchaser order No...dated...and Supplied as per bill/cash memo/challan o...dated....as stated below purchased form you as per bill/cash memo challan No....dated....as stated below) Supplied under your challan No....dated....are for ** resale use in manufacture/processing of goods for sale.... use in mining use in generation/distribution of power packing of goods for sale/resale and are covered by my/our registration certificate No....dated....issued under the Central Sales Tax Act, 1956 () (It is further certified that I/We ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ale cannot, however, be regarded within the meaning of Rule 13, as raw materials in the manufacture or processing of goods or even as "plant". It is true that buildings must be constructed for housing the factory in which machinery is installed. Whether a building is a "plant" within the meaning of Rule 13, is a difficult question on which no opinion need be expressed. But to qualify for specification under Section 8(3) (b) goods must be intended for use of the nature mentioned in Rule 13, in the manufacture of goods. Building materials used as raw materials for construction of "plant" cannot be said to be used as plant in the manufacture of goods. The Legislature has contemplated that the goods to qualify under Section 8(3)(b) must be intended for use as raw materials or as plant, or as equipment in the manufacture or processing of goods, and it cannot be said that building materials fall within this description. The High Court was, therefore, right in rejecting the claim of the Company in that behalf. The expression "electricals" is somewhat vague. But in a factory manufacturing cotton and other textiles, certain electrical equipment in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registration:- (a) Locomotives and motor-vehicles actually used in carrying and removing raw materials during the process of manufacture; (b) locomotives and motor-vehicles used both underground and on surface during mining operations; (c) accessories and spare pails for such locomotives and such motor-vehicles; (d) tyres and tubes for such motor-vehicles; (e) laboratory fittings used for the sampling and analysis of the ore and other raw materials in the initial stages of mining operations and in the process of manufacture. With special leave, the assessee appealed to the Supreme Court: Held, that items (i), (ii) and (vi) (locomotives and motor-vehicles, accessories and spare pis for motor-vehicles and locomotives, and tyres and tubes for motor-vehicles), laboratory fittings out of item (iii) used of sampling and analysis of the ore and other raw materials in the mining operations and in the process of manufacture for sale and cane baskets out of item (vii) used for carrying ore and other materials used in the course of manufacture, should be specified in the certificate of registration Household, hospital equipment with furnishings and fittings [part of item (iii) J, medical supp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made such a false representation, Section 10A is not attracted. Two Judges of the High Court and one Member of the Board of Revenue have come to the conclusion that the respondent was entitled to the preferential rate which he claimed. That is the view of the law taken by them Assuming, without deciding, that the view taken by them is incorrect even then it is impossible to say under the circumstances of the case that the respondent was guilty of making any false representation. The view of the law, which he is contending for is supported by the view taken by two judges of the High Court and one Member of the Board of Revenue. Hence, we fails to see how such a view of the law can be taken as false representation. 25. In the case of Commercial Taxes officer, Circle D, Jaipur v. Rajasthan Electricity Board reported in 104 STC, 89. Rajasthan Electricity Board was engaged in the business of generation and distribution of electricity. Apex Court affirmed the order of the Rajasthan High Court in which it has been held as follows: The High Court held that trucks, trolleys, trailers and the like, but not passenger vehicles, as also their accessories and spare parts, tyres and tubes could ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... alley Fruits Products Co. Ltd., Bareilly v. CST (Supra) dealer was registered for plant and machinery. It produces generator. Penalty under Section 10-A was levied on the ground that dealer was not registered for generator. The claim of the dealer was that generator was machinery and under this belief Form C was issued. This Court set aside the penalty on the ground that the dealer was under the bonafide belief. 29. In the case of CST v. Tek Invest (India) Pvt. Ltd., Haridwar, (Supra), dealer was registered for machinery while it had issued Form C for generator. Thus, penalty was levied under Section 10-A of the Act. This Court upheld the order of the Tribunal and held that generator is machinery. 30. In the case of CST v. Rama & Sons reported in 1999 NTN (Vol. 15), 828; 1999 UPTC, 245, dealer was registered for Biscuits under the Central Sales Tax Act and had issued Form-C for purchase of Toffee and Flash Brush. Assessing Authority levied the penalty under Section 10(b) on the ground that dealer was not registered for Toffee and Flash Brush. Penalty was deleted by the Tribunal. While deleting penalty, Tribunal has observed that Toffee and Biscuits were purchased through common i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only for machinery, plant, spare parts and electrical goods. The goods used for packing of goods but has not mentioned oil seed in the registration application and accordingly, registration application was not issued in oil seed. Dealer, however, issued Form C for oil seed. This Court held that dealer was liable for penalty under Section 10-A of the Act for issuing Form C for oil seed for which it was not registered. 35. In the case of CST v. Rewa Cold Fields Ltd. and Anr. (Supra), dealer was engaged in operating the coal mine, sought registration for the purposes of Section 8 of M.P. Sales Tax Act for timber, kerosene oil, drilling bits, hewing implements of all kinds, dry cells, torches, cement and lime and electrical bulbs. Apex Court considered the definition of the raw material given in Section 2(1) of the Act held as follows: Learned Counsel for the assessee referred to various judgment, Anwarkhan Mahboob Co. v. State of Bombay (now Maharashtra) , Indian Copper Corporation Ltd. v. Commr. of Commercial Taxes (Supra), Union of India v. V.M. Salgaoncar and Bros. (P) Ltd. and CCE v. Ballarpur Industries Ltd. none of which is apposite to the precise definition with which we are ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vered under Section 8(3)(b) of the Act and Rule 13. It has been held that the goods like building material, hospital equipment etc. are not the goods eligible for the benefit of concessional rate of tax. The goods which are not connected with the manufacturing but are connected with the sale or distribution of the manufactured commodity is also not eligible for the benefit of concessional rate of tax, in as much as they are not required for use in the manufacturing. The applicant claimed to be the manufacturer of petroleum products, lubricant, grease, HSD, Kerosene, Furnace oil, LPG, Neptha, Aviation, Turbine oil, Aviation Gasoline, MTO, Cape, waxes. The items in respect of which Form "C" was issued and are in dispute are claimed to have been used in the manufacturing and were intended for use in the manufacturing. 39. With the aforesaid background, let us examine each individual items whether they are eligible for the benefit of concessional rate of tax. LPG Gas Cylinder 40. Claimed to be covered under empty packages. Under the registration certificate empty packages is mentioned for resale and not for use in the manufacturing. Gas were sold filled in cylinder. Cylind ..... 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