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TMI Blog2016 (5) TMI 666X X X X Extracts X X X X X X X X Extracts X X X X ..... dering the cumulative effect of the facts and law we have stated, we have not an iota of doubt in our mind that there should not have been reopening of assessment. However, the finding recorded by the High Court overturning the view of the tribunal that oil-cake and de-oiled cake are the same product and, therefore, both are liable to reduced rate of tax despite the notification only mentions oil-cake, is not defensible. The finding of the High Court as regards oil-cake and de-oiled cake being different products as per the notification dated 31st May, 2002 is correct. However, the assessee shall reap the benefit of initial assessment as the same could not have been reopened. - Decided partly in favour of appellant - CIVIL APPEAL NO.4760 OF 2016 (Arising out of S.L.P.(C) No. 21015 of 2012) - - - Dated:- 3-5-2016 - DIPAK MISRA AND SHIVA KIRTI SINGH, JJ For the Petitioner : M/S MITTER MITTER CO. For the Respondent : MR. V. N. RAGHUPATHY JUDGMENT DIPAK MISRA, J. Delay condoned. 2. Leave granted. 3. The assessee-appellant is engaged in the manufacturing of refined edible oil by solvent extraction process and refining along with trading in edible ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... State of Bihar, 99 STC 47 Eureka Forbes vs. State of Bihar 119 STC 460 and came to hold that the change of opinion could not have been a ground for reopening of assessment in exercise of power under Section 12-A of the KST Act and, accordingly, set aside the order of re-assessment. 7. Though the assessee succeeded, yet it preferred an appeal, being STA No.425 of 2006 before the Karnataka Appellate Tribunal, Bangalore (for short, 'the tribunal'), as the first Appellate Authority had not expressed any opinion with regard to rate of tax on oil-cake and de-oiled cake. It was contended before the Tribunal that the oil cake and de-oiled cake as per the commercial parlance are one and the same and, therefore, the rate of tax has to be at 2 per cent and not 4 per cent. The tribunal after noting the submissions referred to the schedule in the notification and the decision in M/s Sterling Foods vs. State of Karnataka, (1986) 63 STC 239 State of Karnataka vs. M/s Goa Granites 2007 (5) VST 434 (Kar), M/s Habeeb Protiens and Fats Extracts, Hiriyur, Chitradurga District vs. Commissioner of Commercial Taxes, Bangalore and Anr. 2005 (58) Kar.L.J. 155 and came to hold as under : Thu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) Whether on the fact and in circumstances of the case, can it be held that the Appellate Tribunal was right in law in ignoring that under the KST Act in the Second Schedule in serial No.1 of Part O, oil cake and de-oiled cake are listed under two separate sub-headings as two different commodities? 10. After deliberating on the aforesaid two questions, the High Court referred to the provisions of the KST Act and the Notification issued under Section 8(5) of the CST Act, distinguished the decisions placed reliance upon by the first Appellate Authority and the tribunal as well as the decision rendered by this Court in M/s Sterling Foods (supra) and came to hold that there is distinction between oil cake and de-oiled cake and they are two different commodities and not one and the same. Elaborating the discussion, the Division Bench held thus:- The contention that the commodities will have to be understood in common parlance as understood by a common man is even harder to accept. What a common man understands need not necessarily mean what is understood in accordance with law. In the instant case, the framers of the schedule were aware of the distinction between oil cake and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent on the ground that if the assessee has been assessed at a rate lower than the rate at which it is assessable under Act. The rate of tax is four per cent. The assessee had filed the return and the 'C' Forms claiming the benefit of the Notification dated 31.05.2002 in respect of inter-State sale of oil-cakes. The assessing officer had accepted the 'C' Forms on verification and granted the benefit. The assessing officer on a proper security has accept the C Forms on the basis of which reduced rate of tax was claimed. The assessment was reopened as there was no escapement of tax due in respect of inter-State sale in respect of SF DOC. 14. Mr. Dhruv Mehta, learned senior counsel for the appellant, would submit that once an assessment order was framed on all the material available on record and the rate of tax was accepted, the view expressed by the 1st appellate authority which had got the stamp of affirmance by the tribunal should be accepted to be correct more for the reason the revenue had not challenged the order of assessment and that apart the High Court has not appositely dealt with it. He would place heavy reliance on the pronouncement in M/s. Binani Ind ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kers 1980 Supp. SCC 174 the Court held as under:- ..when the State Legislature excluded processed or frozen shrimps, prawns and lobsters from the ambit and coverage of Entry 13a, its object obviously was that the last purchases of processed or frozen shrimps, prawns and lobsters in the State should not be exigible to State Sales Tax under Entry 13a. The State Legislature was not at all concerned with the question as to whether processed or frozen shrimps, prawns and lobsters are commercially the same commodity as raw shrimps, prawns and lobsters or are a different commodity and merely because the State Legislature made a distinction between the two for the purpose of determining exigibility to State Sales Tax, it cannot be said that in commercial parlance or according to popular sense, processed or frozen shrimps, prawns and lobsters are recognised as different commodity distinct from raw shrimps, prawns and lobsters. The question whether raw shrimps, prawns and lobsters after suffering processing retain their original character or identity or become a new commodity has to be determined not on the basis of a distinction made by the State Legislature for the purpose of exigibi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch is justified in recording the finding on the second issue (see para 7, above at p.737 c-d) in connection with LPA NO. 195 of 2006 that the respondent concern is not liable to pay any market fee on the de-oiled cakes sold by it which are stated to be the by-product in the course of manufacturing castor oil which is not one of the items enumerated in the Schedule to the Act and the notification issued by the Directorate? 18. Dealing with the distinction between the oil-cake and the de-oiled cake, the Court referred to the process and quoted from the findings referred by the learned Single Judge. Though the said decision was rendered in the backdrop of Gujarat Agricultural Produce Markets Act, 1963 to levy of market fee, it is absolutely distinctly perceptible from the judgment that the Court has arrived at a definite conclusion that there is a distinction between the oil-cake and de-oiled cake and they are two different commercial products. Thus, when the difference has been drawn by this Court, the assessee herein cannot be allowed to advance a plea that the said test should not be applied, but the commercial parlance test should be adopted to determine the said goods for t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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