TaxTMI 
TaxTMI 
1991 (7) TMI 312
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....e Gujarat Sales Tax Rules, 1970. It was the case of the dealer that the wooden boxes were purchased on payment of tax. The price of the wooden boxes so purchased was Rs. 11,05,928. The Sales Tax Officer did not grant the set-off on the tax paid on the purchase of wooden boxes. The Assistant Commissioner of Sales Tax in appeal confirmed the decision rendered by the Sales Tax Officer. In second appeal before the Tribunal, the dealer challenged the finding as regards the claim of set-off for certain other articles also. The Tribunal did not allow the set-off regarding wooden boxes, but it allowed the appeal filed by the dealer in respect of purchase of certain goods such as pana-sets, name-plates, wooden strips, sellac, hose pipes, acetylene gas, diamond dresser, cutting oil, welding rods and other articles mentioned in the order. 3.. The dealer submitted an application for making reference to this Court in respect of the claim of set-off regarding the alleged sale of wooden boxes. The Revenue preferred application for making reference to this Court in regard to set-off allowed for certain articles. The Tribunal has referred the following questions to this Court: Question at the....
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....he facts and in the In affirmative. In favour circumstances of this case, the Tribunal was of the assessee and right in law in applying the ratio of the judgment against the Revenue. of the Gujarat High Court rendered in the case of Vasuki Carborundum Works [1979] 43 STC 294 in allowing set-off in respect of purchases of several items like name-plates, wooden strips, cellac glue, hose pipes, hardware, packing material and timber under rule 42 of the Gujarat Sales Tax Rules, 1970? 2.. Whether, on the facts and in the circumIn so far as articles ghan stances of this case, the Tribunal was right in and hammer are conlaw in applying the ratio of the judgment in the cerned, in negative, in case of Vasuki Carborundum Works [1979] 43 favour of the Revenue STC 294 in so far as the purchases of acetylene and against the gas, diamond dresser, hardware, emery cloth, assessee. In so far as colour, ghan, hammer, pana-sets, cutting oil, other articles are welding rods, foundation bolts, painting brush, concerned, in affirmapressure guage, emery paper, crank shaft and tive, in favour of the machine tools were concerned and in declaring assessee and against them as consumable stores? the Revenu....
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....cking material has been sold or merely transferred without consideration depends on the contract between the parties. The fact that the packing is of insignificant value in relation to the value of the contents may imply that there was no intention to sell the packing, but where any packing material is of significant value it may imply an intention to sell the packing material. In a case where the packing material is an independent commodity and the packing material as well as the contents are sold independently, the packing material is liable to tax on its own footing. Whether a transaction for sale of packing material is an independent transaction will depend upon several factors, some of them being: 1.. The packing material is a commodity having its own identity and is separately classified in the Schedule; 2.. There is no change, chemical or physical, in the packing either at the time of packing or at the time of using the content; 3.. The packing is capable of being reused after the contents have been consumed; 4.. The packing is used for convenience of transport and the quantity of the goods as such is not dependent on packing; 5.. The mere fact that the consid....
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....deduction or set-off, the dealer is required to show that the goods are not prohibited goods and that the goods were purchased or used as raw material or processing material or as consumable stores in the manufacture of taxable goods. Therefore, what we are required to consider is as to whether the goods mentioned in the question have been used by the dealer in manufacture of the taxable goods. We would consider the goods separately. (1) Name-plates: Unless the name plates are fixed on the ultimate product, the product would not be marketed. Therefore it has got to be held that name-plates are the goods used by a manufacturer in the manufacture of taxable goods in question. This question is concluded by the Supreme Court in favour of the assessee in the case of Collector of Central Excise v. Jay Engineering Works Ltd. reported in [1989] 75 STC 313. It was a case of fan. However, the principle laid down by the Supreme Court would apply even in relation to oil engine also. In view of this settled legal position, as far as this item is concerned, the question is required to be answered in the affirmative in favour of the assessee and against the Revenue. (2) Wooden strips, cella....
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....be decided as to whether they would fall within the expression "consumable stores" occurring in section 13(1)(B) of the Act. While determining this question, the Tribunal has followed the principles laid down by this Court in the case of Vasuki Carborundum Works [1979] 43 STC 294. As indicated hereinabove, this Court has followed the decisions of the Supreme Court in the case of Indian Copper Corporation Ltd. [1965] 16 STC 259 and J.K. Cotton Spinning & Weaving Mills Co. Ltd. [1965] 16 STC 563. Therefore we need not reiterate the principles laid down by the Supreme Court and followed by this High Court. We proceed to determine as to whether any error is committed by the Tribunal while applying the principles in relation to specific item. 14.. Except in the case of "ghan " and "hammer", we do not find that any error is committed by the Tribunal while considering the other items as "consumable stores". As far as "ghan" and "hammer" are concerned, it is difficult to conceive that they can ever be said to be consumable stores. When oil engine is manufactured, "ghan" and "hammer" are being used in the process of manufacture of oil engine. They are certainly not raw materials or proce....