Wax candles are goods distinct and different from wax for the purpose of the Assam Sales Tax Act, 1947.

K. N. SAIKIA, C.J. - The question to be decided in this petition is whether wax candles are goods distinct and different from wax for the purpose of the Assam Sales Tax Act, 1947. If wax candles are distinct goods it will be taxable under the Assam Sales Tax Act; if it is wax it will be taxable under the Assam (Sales of Petroleum and Petroleum Products, including Motor Spirit and Lubricants) Taxation Act, 1955, shortly, "the Petroleum Taxation Act".

2. The petitioner, M/s. Modern Candle Works, is a partnership firm carrying on the business of sale and supply of wax and wax candles since 1971. It purchases wax in bulk, makes candles out of it and sells. The firm is registered now as a dealer under the Assam Sales Tax Act, 1947, hereinafter called "the Act". The Superintendent of Taxes, Gauhati, hereinafter called "the Superintendent", by his notice dated 27th July, 1971 issued under section 10 of the Act directed the petitioner to apply for registration as a dealer under the Act, but the petitioner submitted that it was not obliged to register itself as dealer under the Act as the wax candle being a petroleum product was taxable under the Petroleum Taxation Act. The Superintendent having insisted, the petitioner submitted its application on 1st September, 1972 and the latter was issued Certificate of Registration, No. GAU 3880, with effect from 1st April, 1987 under section 10 of the Act and the petitioner was directed to submit returns.

3. The books of accounts of the petitioner were seized and verified by the Enforcement Branch of the Sales Tax Department and those were forwarded to the Superintendent before whom the petitioner stated that the firm itself having come into existence with effect from 1st April, 1971, no return could be submitted for periods prior to that date; and that wax candle was nothing but wax and hence not taxable under the Act. However, the Superintendent by the impugned order dated 5th March, 1973 held that wax candle was a manufactured product quite distinct and different from wax and that wax candle with wick was itself a commercial commodity capable of being sold or supplied in course of business and as such taxable as "other goods" under the Act.

4. The petitioner therefrom moved a revision petition before the Commissioner of Taxes, Assam, shortly "the Commissioner", under section 31(2) of the Act, contending, inter alia, that a wax candle was simply a long cylindrical mass of wax containing a loose twisted cotton and it could not be regarded as an article made of but different from wax inasmuch as in making a candle out of wax, the essential character of wax does not change and hence the candle should not be treated as a commodity different from wax. The Commissioner rejected the contention holding that wax and wax candle were two different marketable commodities and consequently dismissed the revision petition and confirmed the Superintendent's order dated 5th March, 1973. Hence this petition.

5. Dr. B. P. Saraf, learned counsel for the petitioner, submits, inter alia, that under section 3(vii) of the Petroleum Taxation Act "all other products obtained as derivatives of petroleum and/or natural gas" are taxable under that Act; and there is no dispute that the petitioner paid tax on purchase of wax; that under section 6(1) of the Act the provisions of the Act shall not apply to the sale of goods taxable under the Petroleum Taxation Act and hence wax candles being the same as wax, the candles are not taxable under the Act; that under section 3(4) of the Petroleum Taxation Act, the tax under sub-section (1) thereof shall be levied at the stage of first sale of the taxable goods in Assam; and that there is no dispute that the petitioner paid tax when wax was first purchased. Counsel relies on [1954] 5 STC 365 (Assam) (Kapildeoram Baijnath Prosad v. J. K. Das), [1960] 11 STC 827 (SC) (Tungabhadra Industries Ltd. v. Commercial Tax Officer), [1967] 19 STC 24 (SC) (State of Gujarat v. Sakarwala