Self-utilisation in manufacture is not a taxable sale or supply under the Sales Tax Ordinance.

Sales tax under the Ordinance applies only to bilateral transactions of sale or supply between two persons, because both concepts require one party to transfer goods to another for consideration. The court reasoned that the dealer and taxable turnover provisions do not convert self-consumption into a taxable event, and the reference to "utilisation" in the turnover rule does not alter that basic requirement. Internal use of soda ash in further manufacture therefore was not a sale or supply, and its value could not be included in taxable turnover; the assessment based on self-utilisation was held unsustainable.

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Issues: Whether the internal utilisation of soda ash by a manufacturer in the course of further manufacture amounts to a sale or supply within the meaning of the Sales Tax Ordinance, and whether the price of such utilised soda ash can be included in taxable turnover for sales tax.

Analysis: The levy under the Ordinance is attracted only by sales or supplies effected in transactions between two parties. A sale necessarily requires a buyer and a seller, and a supply likewise postulates a person supplying goods to another person who receives them for consideration. The scheme of sections 5 and 6, read with the definition of dealer and the rules for determining taxable turnover, shows that the tax is imposed on bilateral transactions of sale or supply to another person. The use of the word "utilisation" in the proviso to rule 1 of section 6(3) does not alter that basic principle or convert self-consumption in manufacture into a taxable supply.

Conclusion: Internal consumption of soda ash in manufacturing by-products is not a sale or supply and the value of such soda ash cannot be brought to tax.

Final Conclusion: The reference was answered in favour of the assessee, and the assessment based on self-utilisation of soda ash was held unsustainable.

Ratio Decidendi: Sales tax under this Ordinance is attracted only by a bilateral transaction of sale or supply to another person, and self-consumption of goods in manufacture does not constitute a taxable supply merely because the turnover provisions refer to utilisation.

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