State Taxation Tribunal - West Bengal
Bengal Ingot Co. Ltd. And Ors. vs West Bengal Commercial Taxes Tribunal ... on 9 March, 1990
Equivalent citations: [1990]79STC212(TRIBUNAL)
JUDGMENT
L.N. Ray, Judicial Member.
1. This is an application under Section 8 of the West Bengal Taxation Tribunal Act, 1987. The facts leading to this application are briefly as follows ;
2. The applicant manufactures and sells iron and steel goods. It claimed exemption under Section 5(2)(a)(ii) of the Bengal Finance (Sales Tax) Act, 1941, for the period of 4 quarters ending December, 1980, for sales of alloy steel castings amounting to Rs. 3,19,473.33. The Commercial Tax Officer by his assessment order dated June 1, 1984, disallowed the claim. An appeal against that order was rejected by the Assistant Commissioner on July 30, 1985 and a revision therefrom also failed vide order dated April 5, 1989, passed by the West Bengal Commercial Taxes Tribunal. The main case of the applicant is that although the goods for the sales of which exemption was claimed, comprised articles such as rings, bushes, impellers, check valves and the like, those were steel castings and, therefore, continued to remain iron and steel within the meaning of Section 14(iv)(viii) of the Central Sales Tax Act, 1956, and since the declaration forms had been obtained and furnished for such sales, the authorities below committed an error in rejecting the claim.
3. By a reference to the decision in [1966] 18 STC 222 (SC) (State of Madras v. Radio and Electricals Ltd.), Mr. S.N. Bose, the learned Advocate for the applicant, contended that by furnishing declaration forms as required in the proviso to Section 5(2)(a)(ii) read with the relevant rules, the applicant had discharged its onus and the taxing authorities could not reject the declaration forms. In point of fact, the assessment order of the Commercial Tax Officer will show that the declaration forms were not rejected but accepted vis-a-vis Section 5(1)(aa) of the 1941 Act, because according to him, the impugned sales were of goods which were not covered by Section 14 of the Central Sales Tax Act, 1956. Mr. Bose fairly conceded that under Section 5(2)(a)(ii) there is an initial onus on the part of the applicant to show that the impugned sales were made to registered dealers and were in respect of goods referred to in Section 14 of the Central Sales Tax Act. But he maintained that by production of the declaration forms in which the purchasing dealers mentioned the goods as declared goods under Section 14 of the Central Sales Tax Act, the said initial onus had been discharged. Mr. D. Majumdar, learned State Representative, contested this argument by contending that the declaration forms could not be the evidence of the fact that the goods sold were still covered by Section 14 of the Central Sales Tax Act. Having heard both sides and having considered the materials made available to us, we are of the view that the onus of the applicant had not been discharged by a simple production of the declaration forms. The applicant has not yet produced at any stage any material to show in what manner the purchasing dealers described the impugned goods while placing orders with and taking supplies from the applicant. The learned State Representative, in our view, very rightly opposed any further opportunity being given to the applicant to produce such evidence.
4. The moot question, of course, is whether the goods, which we have already narrated, remained steel castings within the meaning of Section 14(iv) of the Central Sales Tax Act, 1956, at the time of sale, as claimed by the applicant. Mr. Bose referred to the decisions in [1974] 33 STC 292 (Cal) (Phanindra Nath Manna and Company v. Commercial Tax Officer), [1987] 64 STC 180 (SC) (Indian Aluminium Cables Ltd. v. Union of India) and [1980] 46 STC 256 (SC) (Delhi Cloth & General Mills Co. Ltd. v. State of Rajasthan) and contended that the goods in question, namely, bushes, valves, impellers, etc., remained steel castings. He submitted that these goods were manufactured by the applicant out of steel castings without using or mixing any other metal or material. But there is no dispute that the steel castings were processed and machined at the applicant's factory with the result that different articles of various shapes and sizes having different trade names came out and were sold in the market by those names to meet various mechanical and engineering needs. The fact that no other metal or materials was used cannot be the sole criterion to determine whether the commodities sold and marketed by the applicant in different trade names were still known in trade circles as mere steel castings. It is well-settled that where no definition is given in the relevant provisions of law or the relevant rules, a particular item of goods, such as steel castings in this case, has to be interpreted in the manner it is understood and treated in commercial parlance, which is also called common parlance, in other words. That being the legal position, and the applicant being the claimant of exemption under Section 5(2)(a)(ii), it ought to have proved that in commercial parlance, these goods were being treated and understood as steel castings and not otherwise. We have no hesitation in holding that the applicant has failed at all stages to show that in commercial parlance these goods were treated and understood as steel castings. We are unable to agree with Mr. Bose that by production of the declaration forms treating these goods as covered by Section 14 of the Central Sales Tax Act, 1956, it was proved that in commercial parlance the goods were understood as steel castings.
5. In the above view of the matter, we hold that the authorities below rightly disallowed the claim of the applicant under Section 5(2)(a)(ii) of the 1941 Act and there is no reason to interfere with the orders of those authorities. In the result, the application fails, and is dismissed without costs.
B.C. Chakrabarti, Chairman.
6. I agree.
P.C. Banerji, Technical Member.
7. I agree.