The judgment of the Court was delivered by

MEHTA, J. - At the instance of the assessee, the Gujarat Sales Tax Tribunal has referred the following question to us for our opinion under section 69(1) of the Gujarat Sales Tax Act, 1969 (hereinafter referred to as "the Gujarat Act") :

"Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that copper 'strips' sold by the applicant in the present case were not covered by entry 27 of Schedule II, Part A, to the Gujarat Sales Tax Act, 1969 ?"

The facts leading to this reference are as under :

The assessee-company is a private limited company registered under the Companies Act, 1956, and is also holding registration certificate as a dealer under the Gujarat Act. The assessee-company carries on business to manufacture and sell copper-wires, copper strips, etc., at Rajkot. In the course of the assessment period commencing from 1st January, 1973, to 31st December, 1973, the assessee-company had sold copper strips worth Rs. 4,52,573. A question, therefore, had arisen in the course of the assessment as to what should be the appropriate rate of tax at which the turnover of sales of copper strips of Rs. 4,52,573 should be subjected to tax.

The Sales Tax Officer concerned had found those sales to be covered by entry 27 of Schedule II, Part A, to the Gujarat Act, and therefore, levied sales tax on those sales at the rate of 5 per cent under the said Act. However, on scrutiny of the assessment record of the assessee-company, the Assistant Commissioner of Sales Tax was of the opinion that the strips of copper in question having width from 1" to 4" could not be validity subjected to tax under entry 27 of Schedule II, Part A, to the Gujarat Act inasmuch as the said entry did not specifically mention or refer to strips as one of the articles included therein. In the view of the Assistant Commissioner, therefore, the disputed sales would fall within the terms of residuary entry 13 of Schedule III to the said Act, and therefore, the sales of copper strips were chargeable to sales tax at the rate of 5 per cent and general sale tax at the rate of 3 per cent. He, therefore, revised the order of the Sales Tax Officer after issuing show cause notice to the assessee-company in that behalf and after giving an opportunity of hearing.

The assessee-company, therefore, being aggrieved with the order of the Assistant Commissioner, carried the matter in revision before the Gujarat Sales Tax Tribunal. The Tribunal was not impressed with the contention urged on behalf of the assessee-company that the copper strips were rightly subjected to tax by the Sales Tax Officer under entry 27 of Schedule II, Part A, to the Gujarat Act. The Tribunal by its order of 8th September, 1977, dismissed the revision application of the assessee-company which, therefore, sought the present reference and the question set out hereinabove has been referred to us for our opinion.

At the time of hearing of this reference, Mr. S. L. Mody, the learned Advocate appearing on behalf of the assessee-company, urged three ground challenging the order of the Tribunal rejecting the revision application of the assessee-company. The three grounds are as under :

(1) Inasmuch as entry 13 of Schedule III to the Gujarat Act is in the nature of a residuary entry, if any articles or item of goods in question would fall within any specified entry of the earlier schedule to the said Act, the taxing authorities would not be justified nor would they have power or jurisdiction to subject the turnover of sales of such goods or articles under the residuary entry, and the Tribunal, in so far as it confirmed the order of the Assistant Commissioner, committed a clear error of law.

(2) The Tribunal has committed an error of law inasmuch as it failed to construe entry 27 of Schedule II, Part A, in its real perspective and according to the correct principle of law an enunciated by this court in Super Diamond Tools v.