JUDGMENT

These are three appeals by the State of Maharashtra. They arise out of the sales tax assessments of two assessees M/s. Shiv Datt and Sons and M/s. Vora Brothers. In the case of M/ s. Shiv Datt and Sons there are two assessment years 1968-69 and 1969-70 involved, while in the case of M/ s. Vora Brothers, the assessment relates to the period from 1-11-66 to 31-10-67. All the three appeals involve the same issue and can be disposed of by a common order.

2. M/s. Shiv Datt and Sons are dealers for Exide Batteries while M/s. Vora Brothers are dealers for Standard Batteries. They purchase the batteries from the manufacturers and sell them. The question is whether they can be treated as having resold the same good that they have purchased making them eligible for relief under S. 8 of the Bombay Sales Tax Act, 1959.

3. The above question arises for consideration in the following circumstances :

The manufacturers sell to the assessees before us what are described as, "dry batteries without electrolyte". The batteries, when manufactured by the manufacturers, undergo a process known as "formation charge". In this process, the plates of the battery are immersed in a solution of sulphuric acid and distilled water. The plates are connected together by a lead strip and then connected to the two terminals of a source of supply of direct current. This current has an electrolytic action on the plates. After this process is undergone, the plates are dried in the ordinary way. But even after drying, the plates are put in electrolyte and electric current is passed through the plates for a long time. It is not necessary here to discuss the chemical transformation which occurs as a result of this charge. What is important is that, before the manufacturers transport the batteries to dealers such as the present respondents, the electrolyte is thrown out and the plates assembled in the battery manufactured by the manufacturers are dried. These plates do have some electricity charge, which can be retained for about six months if the battery remains in a hermetically sealed condition. However, if the battery comes in contact with air, the charge is lost gradually. It is in this state that the batteries are received by the dealers like the present respondents.

4. After receiving the batteries in the above condition, the dealers, before they sell the batteries, have to again immerse the plates in electrolyte and charge them with electric current for a substantial period before the batteries can be used for the purpose for which they are sold. Dry battery in the condition in which it is received by the dealer, will not give out a charge, even if the electrodes are joined by wire. This is because the positive and negative plates in battery stand separated for want of electrolyte and an electrolyte is a conductor of electricity. That is why it becomes necessary for the dealers to put the plates in electrolyte and also pass a current through the electrolyte for some hours.

5. The respondents were assessed to sales tax under Item 58 of Schedule C to the Bombay Sales Tax Act, 1959. They, however, claimed that they were entitled to a concession provided in S. 8 of the Act under which they were entitled to the deduction of such part of their turnover as represented the resale of goods purchased by them from a registered dealer (subject to certain condition with which we are not here concerned). The question that arose was whether the batteries, in the form they were sold by the respondents, could be said to be re-sale of the goods which they had purchased from the manufacturers. In this context, it is necessary to refer to the definition of re-sale in S. 2(26) of the Act. This definition, in so far as it is now relevant for our purposes, reads as follows :

"Section 2(26) -re-sale, for the purposes of Section 8 means sale of purchased goods -

(i) in the same form in which they were purchased, or

(ii) without doing anything to them which amounts to, or results in a m