Back
1962 Supreme(Pat) 3
PATNA HIGH COURT
V.Ramaswami and N.L.Untwalia JJ.
Indian Copper Corporation Ltd.
Versus
Commissioner Of Commercial Taxes
Miscellaneous Judicial Case No. 602 of 1961 ;
Decided On : JANUARY 09, 1962
The interpretation of Section 8(3)(b) of the Central Sales Tax Act, 1956, and Rule 13 made thereunder, and the scope of enumeration of goods by the Central Government for the purpose of determining goods intended for use in manufacture or processing of goods for sale or in mining.
Headnote:
CENTRAL SALES TAX ACT - REGISTRATION OF DEALERS - GOODS INTENDED FOR USE IN MANUFACTURE OR PROCESSING OF GOODS FOR SALE OR IN MINING - INTERPRETATION OF SECTION 8(3)(B) AND RULE 13 - SCOPE OF ENUMERATION OF GOODS BY CENTRAL GOVERNMENT.
Fact of the Case:
The petitioner, an incorporated company, applied for registration under the Central Sales Tax Act, 1956, and sought to include various goods in the certificate of registration as being required for use in manufacture or processing of goods for sale or in mining. The Sales Tax authorities rejected the claim for certain goods, including household, laboratory, hospital, and general furnishing and fittings, medical supplies, and stationery.
Finding of the Court:
The court held that the petitioner was not entitled to have the aforementioned goods included in the certificate of registration under Section 8(3)(b) of the Act, read with Rule 13, as they did not fall within the enumerated categories of goods specified by the Central Government.
Issues: 1. Whether the goods claimed by the petitioner, such as hospital equipment, medical supplies, and sanitary fittings, fall within the ambit of Section 8(3)(b) of the Central Sales Tax Act and Rule 13. 2. Whether locomotives and motor vehicles used for carrying ores and raw materials before the manufacturing process starts can be considered as intended for use "in the manufacture or processing of goods for sale or in mining".
Ratio Decidendi: 1. Section 8(3)(b) of the Central Sales Tax Act empowers the registering authority to include goods intended for use by the dealer in the manufacture or processing of goods for sale or in mining, subject to rules made by the Central Government. 2. Rule 13, made under Section 13(1)(e) of the Act, enumerates the categories of goods that can be included in the certificate of registration, such as raw materials, processing materials, machinery, plant, equipment, tools, stores, spare parts, accessories, fuel, or lubricants. 3. The court interpreted Section 8(3)(b) and Rule 13 together and held that the registering authority cannot go beyond the enumeration of categories mentioned by the Central Government in Rule 13. 4. The court further held that locomotives and motor vehicles used for carrying ores and raw materials before the manufacturing process starts do not fall within the categories enumerated in Rule 13 and, therefore, cannot be included in the certificate of registration.
Final Decision: The court partly allowed the petitioner's application and issued a writ of mandamus directing the Additional Superintendent of Sales Tax to specify certain goods in the certificate of registration, including locomotives and motor vehicles used during the manufacturing process and mining operations, accessories and spare parts for such vehicles, tyres and tubes, and laboratory fittings used for sampling and analysis of ores and raw materials.
Ramaswami, J.
1. In this case the petitioner is an incorporated company under the name and title of Indian Copper Corporation Limited and has its registered office in Ghatsila in the State of Bihar. In accordance with the provisions of the Central Sales Tax Act (Act No. 74 of 1956) the petitioner applied for registration to the Superintendent of Sales Tax, Jamshedpur, on the 30th April, 1957. The case of the petitioner is that it is purchasing different kinds of goods for use in manufacture in ite copper and kaynite mines and factory. On the 11th July, 1957, the petitioner was granted a registration certificate by the Superintendent of Sales Tax, Jamshedpur, but the Superintendent of Sales Tax rejected the claim of the petitioner that certain goods should be specified in the registration certificate as being required for use in manufacture. The petitioner again applied to the Sales Tax authorities for inclusion of the goods in the certificate of registration under Section 8 (3) (b) of the Sales Tax Act as being required for use in manufacture. The petitioner claimed that the following goods should be specified in the registration certificate, namely,
(i) Locomotives and motor vehicles,
(ii) Accessories and spare parts for motor vehicles and locomotives,
(iii) Household, laboratory, hospital and general furnishing and fittings,
(iv) Medical supplies,
(iy) Stationery,
(vi) Tyres and tubes for motor vehicles, and
(vii) Cane baskets.
The case of the petitioner is that these goods were intended for use in the manufacture or processing of goods for sale and in mining, which included (i) mining ores, (ii) copper refining, and (iii) manufacture of brass sheets. By his order dated the 9th March, 1959, the Assistant Commissioner of Sales Tax held that the petitioner was not entitled to the specification of the following goods in the registration certificate:-
(i) Household, laboratory, hospital and general furnishing and fitting,
(ii) Medical supplies,
(iii) Stationery.
By another order dated the 14th January, 1961, the Additional Superintendent of Sales Tax held that the petitioner was not entitled to have the other items of goods included in the certificate of registration under Section 8 (3) (b) of the Central Sales Tax Act. The orders of "the Assistant Commissioner of Sales Tax, dated the 9th March, 1959, and of the Additional Superintendent of Sales Tax, dated the 14th January, 1961, are annexuree C and D to the application.
2. The petitioner hag now obtained a rule from the High Court calling upon the respondents to show cause why a writ in the nature of mandamus should not be granted commanding the respondents to specify all the goods in the registration certificate as being required for use by the petitioner in the manufacture and processing of goods for sale or in mining within the meaning of Secion 8 (3) (b) of the Central Sales Tax Act.
3. Cause has been shown by the learned Government Advocate on behalf ef the respondents to whom notice of the rule was ordered to be given.
4. The reasons given by the petitioner for incorporation of the goods in the registration certificate are given in annexure B-2 to the application which states as follows:-
"1. Locomotives and motor vehicles. They are used in actually carrying raw materials and removing materials during the process of manufacture and thereafter to different places and also used both underground and on surface in mining operations and the transport of crude ores, a primary operation in the process of manufacture. Also for the transport of necessary stores for mining operations.
2. Accessories and spare parts for locomotive and motor vehicles. The above are absolutely necessary for maintenance and ensuring continual operation of the locomotives and motor vehicles.
3. Hospital equipment with furnishings and fittings are necessary for the hospitals which are run by the corporation for the benefit of the workers in the process of manufacture, and maintaining the health
