The sale of liquor in bottles is not a sale of the bottles as such, but rather a sale of liquor, of which the bottles are the containers.

1. This order will dispose of six references (Sales Tax References Nos. 8, 9 and 10 of 1969 and 1, 2 and 2-A of 1970). Out of these references, five are under Section 22 of the Punjab General Sales Tax Act, 1948 (East Punjab Act 46 of 1948) (hereinafter referred to as the Act) and the sixth reference is under Section 9(3) of the Central Sales Tax Act, 1956 (hereinafter referred to as the Central Act) read with Section 22(1) of the Punjab General Sales Tax Act.

2. Certain questions of law were not referred by the Tribunal under Section 22(1) of the Act. Consequently, an application was made to this Court under Section 22(2) and a question of law set out below was agreed to be framed in place of question No. (2). This question was deemed to have been substituted in all the references :-

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Whether on the facts and in the circumstances of these cases is the price of bottles liable to sales tax when bottled liquor is sold ?

3. The assessee is the Jagatjit Distilling and Allied Industries Limited, Hamira. The assessee is engaged in distilling liquor. For purposes of sale, the liquor is either sold in bottles or in barrels. In the present case, we are concerned with the sale of liquor in bottles. The Assessing Authority brought to tax the price of bottles. Its plea was that when liquor was sold in bottles, there was a sale of the bottles as well and that sale was liable to sales tax under the Act. This stand of the department was controverted by the assessee but without success either before the Assessing Authority or the Appellate Authority or the Sales Tax Tribunal. The department took the view that when liquor is sold in bottle there is a sale of the bottle as well and the sale price of the bottle is liable to sales tax. The plea of the assessee that there was no sale of the bottle was negatived.

4. The following questions of law now fall for determination :-

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(1) Whether the Additional Deputy Excise and Taxation Commissioner exercising the powers of the Commissioner under Section 21(1) of the Punjab General Sales Tax Act, 1948, could not assess escaped turnover after the expiry of the period of four years from the expiration of the assessment year as provided in Section 11-A of the Punjab General Sales Tax Act ?

(2) Whether on the facts and in the circumstances of these cases the price of bottles is liable to sales tax when bottled liquor is sold ?

(3) Whether on the facts and circumstances of the case, there was any sale of the packing material (bottles) in view of the goods having been delivered at the instance of the Excise Authorities under the Punjab Excise Act, 1914, and the Rules framed thereunder to such persons to whom the licence had been granted or the delivery order had been issued ?

(4) Did the dealer have any volition in the sale of the goods ordered to be delivered to a particular licensee, and whether such a delivery could constitute sale within the meaning of the definition as given in the Sale of Goods Act ?

(5) Whether the company could be held to be dealer in straw covers and was liable to pay sales tax on the value of straw covers used for packing ?

5. The first three references in their serial order relate to the years 1956-57, 1957-58 and 1958-59. The next two references relate to the years 1962-63 and 1963-64, and the last one relates to the year 1963-64 and is under the Central Act. The first question only arises in the first three references and in these references the last question does not arise which only arises in the last three references. The remaining three questions are common to all the references. We propose to deal with these questions in the same order in which they have been set out above.

6. Question No. (1)--The contention of the learned Counsel for the assessee is that the Additional Deputy Excise and Taxation Commissioner could not suo motu act under Section 21(1) of the Act. The contention proceeds that in fact what the Additional Deputy Excise and Taxation Commissioner was doi