Commercial identity test governs single point taxation and second-sale exemption where goods lose their original character.

Under single point taxation, each commercial commodity is treated as a distinct taxable unit unless the statute indicates otherwise, so items listed separately in the Third Schedule are not merged merely because they appear in the same sub-clause. The stated test is whether each item retains a separate commercial identity. On second-sale exemption, pig iron used to make ingot moulds lost its original identity when the moulds became unserviceable and were later sold as scrap, so the scrap was treated as a different commodity from the pig iron originally purchased. Accordingly, the exemption was unavailable because the goods sold later did not remain the same commodity.

---

---

Issues: (i) Whether the commodities listed in a sub-clause of the Third Schedule are to be treated as separate commodities for the purpose of single point taxation; and (ii) whether pig iron and the scrap arising from discarded ingot moulds manufactured from it are the same commodity so as to qualify for second-sale exemption.

Issue (i): Whether the commodities listed in a sub-clause of the Third Schedule are to be treated as separate commodities for the purpose of single point taxation.

Analysis: The statutory scheme of single point taxation applies to each commercial commodity as a distinct taxable unit unless the statute indicates otherwise. A listed item is to be understood in its ordinary commercial sense, and separate items in the schedule are not to be collapsed into one class merely because they appear in the same sub-clause. The relevant test is whether the item retains its separate commercial identity.

Conclusion: The items listed in the sub-clause are separate commodities for the purpose of single point taxation.

Issue (ii): Whether pig iron and the scrap arising from discarded ingot moulds manufactured from it are the same commodity so as to qualify for second-sale exemption.

Analysis: Pig iron was used to manufacture ingot moulds, and the moulds were later used in the manufacturing process and sold only after becoming unserviceable. By that stage, the original identity of the pig iron had been lost and the goods had assumed a different commercial character. The scrap sold later was therefore not the same commodity as the pig iron originally purchased, and the claim of exemption on the footing of a second sale was not available.

Conclusion: Pig iron and the scrap sold later are different commodities, and the assessee is not entitled to second-sale exemption.

Final Conclusion: The revision fails because the disputed scrap did not retain the identity of the tax suffered pig iron, and the scheduled items were rightly treated as separate commodities.

Ratio Decidendi: For single point taxation, each commercial commodity is treated as a distinct taxable unit, and exemption based on second sale is unavailable once the original goods lose their identity and emerge as a different commercial commodity.

---