TaxTMI 
TaxTMI 
1998 (12) TMI 581
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....grinders were not taxed as already the grinder body and grinder motor had suffered tax and exemption was granted treating the sale as second sale, but from 1994-95 onwards, the Revenue has refused to give exemption treating the sale of the wet grain grinders as first sale and has levied tax and in other cases pre-assessment notices have been issued, proposing to levy tax on the sale of such wet grain grinders and in some other cases pre-revision notices under section 16 have been issued, to reopen the order of assessment. 2.. As a common question has arisen in all these petitions as to the claim of the revenue to levy tax on wet grain grinders, though the components therein had already suffered tax, all these petitions were heard together and a common order is passed. 3.. Prior to March 12, 1993 the wet grinders were governed by entry 41-E of the First Schedule to the TNGST Act and with effect from March 12, 1993 it was brought under entry 11 of part D of the First Schedule to the Act. Subsequently, from July 17, 1996 it has been brought under entry 65 of Part D of the First Schedule to the Act. Prior to January 1, 1983 the wet grinder was treated only as machinery falling un....
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....inding. The third photo is the grinder, covered by sunmica sheets at the bottom of all four sides. The learned counsel M/s. K.J. Chandran, Venkatasubramanian, Srikanth, contended that the appearance as well as name of the commodity has no change even after the grinder body being fitted with the grinder motor and therefore the commodity remains the same without any change in all aspects. They further contended that both under the previous entry, namely, entry 41-E of the First Schedule and the subsequent entry 11 of Part D, there is not much change and under entry 41-E the item is described: "Wet grain grinders designed for use with electricity or other form of power (whether or not sold as a composite unit, with or without motors) and the parts and accessories of such grinders." Indicating that the grinder with or without motor makes no difference for the purpose of levy of tax and as the wording of the entries itself indicates that the wet grinder with or without motor has to be treated alike, when tax has been paid for the grinder and motor before they were combined, the wet grinder with motor has to be treated as an item which has already suffered tax and therefore, the....
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....at motor and the body of the wet grinder were simply combined, like the joining together of the two sheets of paper with wax or bitumen and it is argued that, the decision in that case, has to be followed here also. The third case relied upon by the petitioners is the State of Tamil Nadu v. Pyare Lal Malhotra [1976] 37 STC 319 wherein at page 325 the apex Court has observed that: "Where commercial goods, without change of their identity as such goods, are merely subjected to some processing or finishing or are merely joined together, they may remain commercially the goods which cannot be taxed again, in a series of sales, so long as they retain their identity as goods of a particular type." But the apex Court has added at the end of page 324 that: "The mere fact that the substance or raw material out of which it is made has also been taxed in some other form, when it was sold as a separate commercial commodity, would make no difference for purposes of the law of sales tax. The object appears to us to be to tax sales of goods of each variety and not the sale of the substance out of which they are made............. As soon as separate commercial commodities emerge or come....
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....eld that it was only a second sale. But it must be remembered that, a consumer goes to the optical shop, gives the prescription of the doctor as to the type of lens with the specific power and the lens is purchased. Then the consumer chooses the spectacle frame according to his choice with reference to its shape and price. Even though the seller gives a single bill for the frame and the lens, the purchase by the consumer will be normally separate of the lens and spectacle. The seller engages labourers to fit the lens in the frame and collects the charges for the spectacles, lens and the labour in one bill. It is only for the sake of convenience, the single bill is raised, though the transactions of sales are independent. Therefore the sale of spectacles is really a second sale. 8.. Another decision referred to by them is Jodhpur Mukhya Mandi Vyapar Sangh v. Additional Commissioner, Commercial Taxes Department [1996] 102 STC 255 (RTT) which relates to the sale of tea packets. Loose tea when sold in packets weighing 20 kgs. or more is taxable at 4 per cent. Such tea when sold in smaller packets will not be exigible to tax, because they cannot suffer tax again after the first point....
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....rein that as iron rods and wires are so closely knit in the sub-item, the wires cannot be treated as a separate commercial commodity different from the rods and once the tax was collected for the rods, wires cannot be again taxed. Lastly, they cited a decision in State of Maharashtra v. Central Provinces Manganese Ore Co. Ltd. [1977] 39 STC 340 (SC). That is a case in which the manganese ore was sold as oriental mixture, which was taxed under the Central Provinces and Berar Sales Tax Act, treating the same as a different item. In that case the manganese ore of different mines were heaped together and they were transported under the brand name "Oriental mixture". The revenue treated it as a new product, for the purpose of levy of tax. The Supreme Court has held that: "The mere giving of a name by the assessee to what was really the same product which was not manufactured cannot be a reproduct and as there was a contract to supply the manganese ore with permissible percentage of other ingredients as admixtures. When various grades of manganese ore were heaped together and in the mechanical process of transportation of the mixture, the manganese ore by name oriental mixture was obt....
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....acturers Pvt. Ltd. v. Collector of Central Excise, Hyderabad [1989] 73 STC 81, the apex Court has considered the assembling of certain items to manufacture weighbridges. In that case, out of imported load cells, platforms manufactured by other persons and the indicator system manufactured by the assessee. He assembled the weighbridge and contended that it would not amount to manufacture of the weighbridge and he was not liable for the excise duty, when especially, the indicator system manufactured by the assessee had already suffered tax, and for the load cells already excise duty was paid. The apex Court after considering the nature of the articles used for assembling the weighbridges has held that as a result of the assemblage of the parts a new product known in the market and falling under the part of item "weighbridge" came into being and therefore the weighbridge was liable to excise duty. In Zenith Building Contractors v. State of Tamil Nadu [1994] 93 STC 114 (Mad.) the assessee purchased mild steel rods and rounds from which he fabricated and supplied steel grills to the Tamil Nadu Electricity Board in terms of the specifications given by the Electricity Board for use in the....