Commercial parlance and prospectivity govern rubber tax concessions, while condemned goods sold as scrap remain taxable accordingly.

Commercial parlance governs whether compounded rubber is a "finished rubber product" for concessional purchase tax, and marketability plus distinct trade identity support that classification; accordingly, the concession under S.R.O. No. 641 of 1981 applies for the relevant period. A later notification that excludes compounded rubber changes the earlier position rather than merely clarifying it, so it operates prospectively from the date expressly stated and does not withdraw the concession retrospectively. Goods such as empty drums, old newspapers and gunny bags sold in bulk as condemned items are treated as scrap, making the turnover taxable at the scrap rate.

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Issues: (i) Whether compounded rubber manufactured by the assessee is a finished rubber product eligible for concessional purchase tax under S.R.O. No. 641 of 1981; (ii) whether S.R.O. No. 1516 of 1990 is clarificatory and retrospective; and (iii) whether the sale of condemned articles such as empty drums, old newspaper, gunny bags and similar items is taxable as scrap.

Issue (i): Whether compounded rubber manufactured by the assessee is a finished rubber product eligible for concessional purchase tax under S.R.O. No. 641 of 1981.

Analysis: The notification granted a reduced rate to rubber purchased by manufacturers of finished rubber products for use in making such products within the State. The determining test was the commercial understanding of the goods, their distinct identity in trade, and whether they had marketability as a product in their own right. The materials placed by the assessee, including trade evidence and excise classification, supported the view that compounded rubber was treated in commerce as a marketable product, even if it was later used as raw material for tyres and other goods. The finding of the Tribunal on this factual aspect was not shown to be perverse.

Conclusion: Compounded rubber is a finished rubber product, and the assessee is entitled to the concessional rate under S.R.O. No. 641 of 1981 for the relevant period.

Issue (ii): Whether S.R.O. No. 1516 of 1990 is clarificatory and retrospective.

Analysis: The later notification introduced an explanation excluding compounded rubber and itself stated that it would come into force from 1 April 1989. The language of the amendment showed that it altered the earlier position rather than merely explaining it. A notification taking away a concession could not be treated as retrospectively operative beyond the date expressly provided. The earlier decision relied on by the Revenue did not decide the point against the assessee and did not establish retrospective operation from 1 April 1981.

Conclusion: S.R.O. No. 1516 of 1990 is an amendment with prospective operation only from 2 November 1990.

Issue (iii): Whether the sale of condemned articles such as empty drums, old newspaper, gunny bags and similar items is taxable as scrap.

Analysis: The Tribunal found, on the basis of the manner of sale and the character of the goods, that both seller and buyer treated the items as condemned articles sold in bulk as scrap. That finding was supported by the record and did not justify interference in revision.

Conclusion: The turnover from such items is taxable at the rate applicable to scrap.

Final Conclusion: The revision cases fail. The assessee retains the concessional benefit for the period prior to 2 November 1990, while the later amendment operates only prospectively and the scrap-sale finding stands affirmed.

Ratio Decidendi: For sales tax concessions, the expression "finished product" is to be understood in commercial parlance with emphasis on marketability and distinct identity in trade; a later notification that substantively withdraws or restricts an earlier concession operates prospectively unless the statute clearly authorises retrospective effect.

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