Purchase tax liability depends on the crusher actually opted for and worked, not every licensed crusher in the unit.

Purchase tax under the U.P. Sugarcane (Purchase Tax) Act, 1961 turned on the crusher actually opted for and worked, not every crusher covered by a licence. Reading the Act with the U.P. Khandsari Sugar Manufacturers Licensing Order, 1967, the court noted that liability attached to the owner of the unit disclosed in Form XIII, while the Licensing Order dealt only with suspension or cancellation for non-working. Because the assessee declared and worked only one crusher, and the second remained sealed and outside the opted unit, tax could not be imposed on that second crusher. The revenue's reliance on the Full Bench precedent was rejected as factually distinct.

---

---

Issues: Whether, for the purpose of purchase tax under the U.P. Sugarcane (Purchase Tax) Act, 1961, the assessee could be taxed on a second power crusher which was licensed but was not worked and was not included in the option exercised in Form XIII.

Analysis: The scheme of the U.P. Khandsari Sugar Manufacturers Licensing Order, 1967, and the U.P. Sugarcane (Purchase Tax) Act, 1961, was examined together. The Licensing Order regulated licence to work a power crusher and provided only for suspension or cancellation where a crusher was not worked without adequate reason. It did not create liability to purchase tax for every crusher covered by the licence. Under section 2(c) and section 3(1), (1-a) and (1-b) of the Act, tax was payable by the owner of a unit, and the option under Form XIII related to the unit actually chosen for working. Rule 13-A and Schedule I also treated assumed purchase with reference to the unit disclosed in the declaration. On the admitted facts, the assessee declared that only one crusher would be worked, actually worked only that crusher, and the second crusher remained sealed. The Full Bench precedent relied upon by the revenue was held inapplicable because that case concerned a unit in which the entire multi-crusher unit had been opted for and then reduced in operation, whereas here the second crusher was never included in the opted unit.

Conclusion: The assessee was not liable to purchase tax on the second power crusher, and the demand based on assumed purchase in respect of that crusher was unsustainable.

---