TaxTMI 
TaxTMI 
TaxTMI 
1980 (12) TMI 176
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.... outside the Union Territory of Delhi for processing of compound prepared by mixing raw rubber with china-clay and burada?" The assessee was a registered dealer under the Bengal Finance (Sales Tax) Act, 1941, as applied to the Union Territory of Delhi. The certificate of registration was issued to the assessee and in column 3(a) of that certificate the following items were specified for the purpose of manufacture: (1) raw materials, (2) chemicals, (3) oils, (4) solvent oils, (5) tyre cord, (6) bead wire, (7) solder (lead and tin) and (8) iron sheets. The assessee has a factory for manufacture of rubber goods at Loni Road, Shahdara, Delhi, since the year 1957. In September, 1970, the assessee shifted one of the processing units at Giani Bor....
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....to their factory situated at Giani Border, U.P.: (a) raw rubber, (b) synthetic rubber, (c) reclaim rubber, (d) china-clay, (e) black carbon, (f) burada and (g) spindle oil. He further stated that besides this, items like burada, reclaim, carbon A O, sulphur, accelerators, anti-oxidants, zinc oxide, stearic acid, wax, china-clay, finishing agents, which are purchased as raw materials on the strength of the local registration certificate, are not being transferred to their factory at U.P. It has been further mentioned that the compound processed in U.P. factory is not a salable commodity and that the entire stocks of processed compound are being brought back to Delhi. However, in spite of the said remand report, the Assist. ant Commissioner h....
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....than for which they were purchased and hence the second proviso to section 5(2)(a)(ii) was attracted and the price of goods purchased was liable to be included in the taxable turnover of the assessee. This judgment was, however, reversed by the Supreme Court in the case of Polestar Electronic (Pvt.) Ltd. v. Additional Commissioner, Sales Tax[1978] 41 S.T.C. 409 (S.C.)., on the ground that at the relevant time the manufacture and sale contemplated by the section were not restricted to the territory of Delhi but could also be outside. In any case, these cases have no relevance for the controversy in the present case. Section 5(2)(a)(ii), after its amendment on 28th May, 1972, reads as under: "Section 5. (2)(a)(ii) In this Act the expression....
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....nished in the prescribed manner by the dealer who sells the goods; Provided further that where any goods specified in the certificate of registration are purchased by a registered dealer as being intended for resale by him or for use by him as raw materials in the manufacture of goods for sale, but are utilised by him for any other purpose, the price of the goods so purchased shall be allowed to be deducted from the gross turnover of the selling dealer but shall be included in the taxable turnover of the purchasing dealer." Before the amendment of the section the words "in the Union Territory of Delhi" were not there and on this basis the aforesaid case of Polestar Electronic (Pvt.) Ltd. v. Additional Commissioner, Sales Tax[1978] 41 S.T.....
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....ent from their component parts; their properties and uses were also different and they were sold as different commercial products and as such the appellant was not entitled to the exemption claimed. The question whether there was any manufacturing process involved in the preparation of any fertiliser mixture or whether shovel mixing of the chemical fertiliser amounted to manufacture or not, was found to be irrelevant and was not decided. Therefore, this case is of no help to the learned counsel for the department. In the present case, we have definite findings to the effect that only some of the items mentioned in column 3(a) are taken out of the Union Territory of Delhi and the process involved is only of mixing raw rubber with china-clay ....