TaxTMI 
TaxTMI 
2012 (11) TMI 495
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...., Kamal, and the subsequent order in appeal, dated May 8, 1992 (P5) passed by the Sales Tax Tribunal, Haryana. The petitioner is engaged in the manufacture of stainless steel, alloy steel and alloy castings. The petitioner purchases raw material like ferro cilicon, ferro mangnize, charge chrome, nickel, silver nitrates, etc, from within the State of Haryana as well as from outside the State of Haryana and uses them for the manufacturing of above products. The petitioner is registered under the Haryana General Sales Tax Act, 1973 (for brevity, "the 1973 Act") as well as under the Central Sales Tax Act, 1956 (for brevity, "the CST Act"). The petitioner filed its quarterly returns in respect of the assessment years 1983-84, 1984-85 and 1....
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....er, the Tribunal accepted the plea of the assessee-petitioner against levy of interest and imposition of penalty. We have heard learned counsel for the parties at length and perused the paper book with their able assistance. A perusal of sections 6 and 17 of the 1973 Act shows that every dealer is liable to pay tax on the sale or purchase of goods by him in the State at the stage provided by section 17 in respect of declared goods. The expression "declared goods" has been defined by section 2(d) of the 1973 Act to have the same meaning as has. been assigned to it by section 2(c) of the CST Act. On a reference to section 2(c) of the CST Act we find that the "declared goods" would be such goods which are listed in section 14 of the CST Act....
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....s a levy on the purchase of raw material purchased within the State which is consumed in the manufacture of other goods within the State. If, however, the manufactured goods are sold within the State, no purchase tax is collected on the raw material, evidently because the State gets larger revenue by taxing the sale of such goods. (The value of manufactured goods is bound to be higher than the value of the raw material). The State Legislature does not wish to-in the interest of trade and general public-tax both the raw material and the finished (manufactured) product. . ." The honourable Supreme Court also opined on the State policy of taxation, namely, when the manufactured goods are not sold within the State but are yet disposed of or ....
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....a. But does that change the nature and character of the levy? Does such postponement-if one can call it as such-convert what is 'avowedly a purchase tax what is on raw material (levied on the purchase price of such raw material) to a consignment tax on the manufactured goods? We think not. Saying otherwise would defeat the very object and purpose of section 9 and amount to its nullification in effect. The most that can perhaps be said is that it is plausible (as pointed out by Ranganathan, J. in his separate opinion) to characterise the said tax both as purchase tax as well as consignment tax. But where two interpretations are possible, one which sustains the constitutionality and/or effectuates its purpose and intendment and the other whic....