TaxTMI 
TaxTMI 
1967 (8) TMI 104
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....turnover included labour charges which could not be taxed. The finding of the Commercial Tax Officer was that the petitioner sold finished articles of jewellery and that no portion of the turnover could be regarded as labour charges. But he thought that the sales consisted of distinct sales of component parts of a manufactured jewel. According to him when there was a sale of a jewel in which a precious stone had been set, there was a sale of that precious stone and a sale of the gold in which it was embedded. The position, he thought, was similar when there was a sale of a jewel in which an artificial stone had been set. So he thought that tax was payable at 1½ per cent. of the turnover which related to the sale of gold, at 3 per cen....
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.... there was a sale of such precious or artificial stone, as the case may be, and so, with respect to such sale the higher tax specified in the third column of the 64th item in the Second Schedule to the Act was payable. The Sales Tax Appellate Tribunal did not have any doubt in its mind about the correctness of the finding recorded by the Commercial Tax Officer and the Deputy Commissioner that the contract of sale between the customer and the petitioner in each case was a contract for the sale of a finished article of jewellery. That being so, if nothing else could be said about it, the tax payable was the tax specified either in sub-section (1) of section 5 which is 2 per cent. of the turnover or the tax specified in the proviso to th....
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....te Tribunal did not record a finding that there was any sale of a precious stone, as such, by the petitioner to any one of his customers, it was of the opinion that if an article in which a precious stone was set, was sold by the petitioner to his customer, that sale was a sale of precious stone. Support for this view was deduced from the words "whether they are sold loose or as forming part of anything in which they are set" occurring in the second column of the 64th item of the Second Schedule which has been extracted above. We do not think that the interpretation placed by the Tribunal on these words can be supported. A reference to the Second Schedule is to be found in sub-section (3) of section 5 which reads: "5. (3) Notwithstand....
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....d loose or as forming part of anything in which they are set" assume importance and can have relevance only in a case where stones set in that way are themselves sold as such. But if there be no such contract of sale, and in consequence there is no sale of such precious stones, those words in the 64th item of the Second Schedule cannot assist a demand for the payment of tax at the rate specified in the third column against that entry. Now the finding of the Commercial Tax Officer and the Deputy Commissioner from which the Sales Tax Appellate Tribunal did not dissent, was that the sale was of finished article of jewellery, the component parts of which were either gold and a precious stone or an artificial stone. Such is the effect of that....
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....ercial Tax Officer who did not accept the return produced by the petitioner in which he claimed an exemption in respect of labour charges, recorded a clear finding that the sales were sales of finished products of jewellery. He did not record a finding that there was a sale of either gold, or a precious stone or an artificial stone as such. Whatever may be the return produced by a dealer under the Sales Tax Act and whatever may be the rate at which a dealer claims to be charged, it is the duty of the Commercial Tax Officer to make a determination of the tax really payable under the provisions of the Act which are applicable to the sales, having regard to the character of those sales determined by him. That being so, if the Commercial Tax....