JUDGMENT

KAPADIA, J.—

This civil appeal is directed against the judgment and order dated 21.9.2000 passed by the Orissa High Court in SJC No.157 of 1996 holding that the consideration received by the manufacturer for over-retention of gas cylinders did not constitute ‘sale price’ as defined under Section 2(h) of the Orissa Sales Tax Act, 1947. According to the impugned judgment there was no transfer of right to use the cylinders and that the charge levied by the respondent-assessee for over-retention of the gas cylinders was in the nature of penalty, and therefore, the same did not form part of the sale price as defined in Section 2(h) of the 1947 Act. The impugned judgment has been challenged by the Department.

(2)The short question which arises for determination in this civil appeal is whether there was transfer of the right to use the goods for consideration under the extended definition of the word ‘sale’ under Section 2(g) (iv) of the said 1947 Act which incorporates the concept of transfer of the right to use any goods from Article 366 (29A)(d).

(3)The assessee was a registered dealer during the assessment year 1986-87. During that year it carried on business in manufacture and s