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TMI Blog2016 (9) TMI 311X X X X Extracts X X X X X X X X Extracts X X X X ..... suggestive of the fact that Cochin Cement Limited is a brand name holder or trade mark holder. Hence, the ambitious submission of Mr. Ganesh has to melt as a glacier, and we say so. Ergo, the decision in Cryptom Confectioneries Pvt. Ltd. does not require reconsideration. Appeal dismissed. Decided against appellant. - Civil Appeal Nos. 2678-2679 of 2010, Civil Appeal Nos. 5980-5981 of 2010 - - - Dated:- 28-7-2016 - Dipak Misra And Rohinton Fali Nariman, JJ. JUDGMENT Dipak Misra, J. The appellant entered into an agreement on 08.04.1993 with Cochin Cement Limited - a company registered under the Companies Act, 1956. The relevant clauses of the agreement are as follows :- 1. ACC shall sell to Cocem Cement Clinker Ex its Wadi Cement Works on regular basis at the supply rate of 300 T per day so as to enable Cocem to produce Ordinary Portland Cement or any other type of cement as per the marketing need from time to time. The price of clinker will be linked to the price of cement in the Kerala market and will be reviewed every six months on this basis. The formula for such price adjustments will be as detailed in Annexure 'A' attached to and forming part of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt Limited should be treated as the first sale. The Assessing Officer, on the basis of Intelligence Report and other materials brought on record, came to the conclusion that the Cochin Cement Limited had been manufacturing the cement and handing over the same to the assessee. On a perusal of the impugned orders, it is noticeable that the report of the concerned intelligent officer has met with approval up to the revisional stage. To have a complete picture we may usefully reproduce the finding recorded by the assessing officer in the order of assessment:- As per schedule to the agreement, Associated Cement Cos. is charging ₹ 150/- per ton for marketing and service charges and only after deducting that amount, Associated Cement Co. need pay the balance to Cochin Cement Ltd., after adjusting the price of clinker. During the course of inspection on 16.4.99 effected in the premises of Cochin Cement Ltd., at Ernakulam a copy of the report regarding cement marketing prepared by Sri S. R.Iyer, Senior Dy. General Manager, Cochin Cement Ltd, was recovered by Intelligence Squad No. 1, Ernakulam which reveals that cement manufactured by Cochin Cement Ltd. is fully marketed by Assoc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lder or the trade mark holder within the state shall be the first sale for the purpose of this Act . The impugned transaction is a typical one coming under the above provision. The Cement sold by the Assessee is one which is manufactured by Cochin Cement Ltd. and from Cochin Cement Ltd Assessee purchased and cement so purchased sold under its brand name ACC and claimed exemption as second sale. But by virtue of above said provision, the Assessee s 2nd sale is treated as first sale. 3. Be it noted, the order of assessment has received the stamp of approval by the higher authorities as well as by the High Court. In this backdrop, we may proceed to analyse the statutory scheme. Section 5(1) of the Act, which is the charging Section, reads as follows:- Every dealer (other than a casual trade or agent of an non-resident dealer) whose total turnover for a year is not less than two lakh rupees and every casual trader or agent of a non-resident dealer, whatever be his total turnover for the year, shall pay tax on his taxable turnover of that year. 4. Mr. S. Ganesh, learned senior counsel appearing for the appellant, has laid immense emphasis on Section 5(2), which reads ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f section 5 of the Act. Keeping in view the aforesaid provision, let us once again trace the transaction between the appellant and the licensee, namely, M/s. Bristo Foods Pvt. Ltd. 7. On a scrutiny of the facts of the said case, it is manifest that the issue that squarely fell for consideration is whether the sale at the hands of the appellant therein would be treated as the first sale. Dealing with the stand of the appellant, this Court stated:- According to the appellant/ assessee who is a branded name holder, M/s Bristo Foods Pvt. Ltd., has licence and is permitted to use the branded name CRYTM . The licensee manufactures the goods, namely, confectioneries and effect supply of sale to the brand name holder. It is the brand name holder, who effects the sale of the confectioneries which are to be taxed as item 39 of the First Schedule to the Act within the State. Therefore, it is the brand name holder, who has to be pay tax under section 5(2) of the Act. If for any reason M/s Bristo Foods Pvt. Ltd. has paid the tax while effecting the supply of the manufactored commodity to the appellant/assessee, the appellant/assessee and M/s Bristo Foods Pvt. Ltd. can approach the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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