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TMI Blog2016 (5) TMI 640X X X X Extracts X X X X X X X X Extracts X X X X ..... /2013, C.O No. 39/Kol/2013 - - - Dated:- 6-4-2016 - Shri M. Balaganesh, Accountant Member, and Shri S.S Viswanethra Ravi Judicial Member For The Appellant : None appeared For The Cross objector/assessee: Shri A.K.Tibrewal, FCA, ld.AR ORDER SHRI M.BALAGANESH, AM These appeals of the revenue and cross objection of the assessee arise out of the consolidated order of the Learned CIT(A)-I, Kolkata in Appeal Nos. 85-89 / CIT(A)-I/58(4)/11-12 dated 19.11.2012 against the consolidated order of the Learned AO framed for the Asst Years 2005-06 to 2009-10 u/s 206C(6)/206C(7) of the Income Tax Act, 1961 (hereinafter referred to as the Act ). Since the issue involved in all the appeals of the revenue are identical in nature, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the sawn timber is sold by the assessee to various manufacturers and hence the provisions of section 206C of the Act cannot be imposed on the assessee. The Learned AO not being satisfied with the replies of the assessee, treated the assessee as assessee in default for failure to collect tax at source in terms of section 206C(1) of the Act. On first appeal, the Learned CIT(A) held that sawn timber is different from timber as there was radical change from timber to sized timber. Accordingly, he held that the provisions of section 206C(1) is not applicable to the assessee. Aggrieved, the revenue is in appeal before us by raising the similar grounds for the asst years 2005-06 to 2009-10. The grounds raised for the Asst year 2005-06 are as belo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the caption Restriction of Sale etc . b) Pictorial representation of business process of timber into sawn timber. He further placed reliance on the decision of the Hon ble Calcutta High Court in the case of Shaw Bros. and Co vs The State of West Bengal reported in 1963 14 STC 878 (Cal) . He further argued that the sawn timber were sold to the persons who utilized goods for the purpose of manufacturing, processing and producing articles or things for the purposes of making furniture and all those transactions were excluded from collection of tax at source u/s 206C(1A) of the Act. In respect of Cross objections of the assessee, the Learned AR without prejudice to his arguments above, argued that if the buyer of the sawn timber h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... obtained by any mode other than under a forest lease . The Learned CIT(A) had given a categorical finding that the assessee had traded only in Sawn timber and not timber. We have to decide whether the timber could be different from sawn timber. The term timber and sawn timber is not defined in the Act. For this purpose, we find lot of force in the arguments of the Learned AR and the documents relied upon by him. We find from the tender document floated by Himachal Pradesh State Forest Development Corporation Limited for Timber , in para 14 under the caption Restriction of Sale etc , it is mentioned as below:- 14. No purchaser shall sell timber purchased by him to another party while such timber is lying in the Corporation depot. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... combinations whether by hand labour or machines. If the change made in the article results in a new and different article then it would amount to manufacturing activity. 6.3. We find that the Learned CIT(A) had placed reliance on the decision of the Hon ble Supreme Court in the case of Deputy CIT vs Pio Food Packers reported in 46 STC 63 SC , that :- Further, in the case of State of Orissa vs Patel Mills (37 STC 392 Ori) held that purchasing logs or timber, sawing them into planks , sleepers , etc., amount to manufacture. Hence it could be safely concluded that the timber is different from sawn timber and hence the provisions of section 206C of the Act would not be applicable to the assessee. 6.4. We find that the Lear ..... X X X X Extracts X X X X X X X X Extracts X X X X
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