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2010 (6) TMI 720

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....ocate for the petitioners and Mr. R. Dubey, learned standing counsel, Revenue, for the respondents. The unrebutted pleaded case of the petitioner, in absence of any counter by the respondents, is that the petitioner-firm is a registered dealer under the Act and is engaged in the business of marketing aluminium manufactured by one M/s. Hindalco Industries Ltd. It receives plain aluminium sheets and extrusions in metal form and not finished products on stock transfer basis on behalf of the above company and the same are marketed by it without subjecting the same to any further process of fabrication or processing of any kind. The Government of Assam by Gazette Notification dated December 24, 1999 issued in exercise of its power under section 8(2) of the Act prescribed a uniform rate of tax of eight per cent for aluminium sheets incorporated as entry 10 to Schedule IV thereof. The incidence of such levy on the aluminium sheets spanned over two stages at four per cent each at the first and the last points of sale in the State. According to the petitioners, this measure to introduce a uniformity in the tax structure introduced by the Government of India met with some reservation of the....

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....llows: SCHEDULE IV "Entry 10 Aluminium corrugated sheets and plain sheets 8 - 4 - 4" It is the petitioner's plea that having regard to the import of the notifications in succession, aluminium plain sheet was treated to be covered by entry 45(b) for the period January 1, 2000 to February 18, 2002, i.e., prior to the amendment brought into effect by the notification dated February 15, 2002. Consequently, according to them, aluminium plain sheets were taxable at four paise in a rupee during this period. As a matter of fact, the petitioners were assessed under section 17(4) at the said rate by the order dated September 15, 2001 of the Senior Superintendent of Taxes, Guwahati, Unit B, Guwahati, for the period ending March 31, 2001 at four per cent in terms of entry 45(b) of Schedule II. Inspite thereof, they were served with a notice on March 20, 2002 from the Superintendent of Taxes, Zone B, acting under section 44(1) of the Act directing them to produce the books of accounts relating to their business for the period 2000-01 and 2001-02, which they complied. The impugned notice dated November 7, 2002 from the Deputy Commissioner of Taxes, Guwahati, Zone B, followed, conveyin....

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.... of Schedule II prior thereto, he urged. According to the learned senior counsel, the fact that no similar amendment vis-a-vis other metals mentioned in entry 45(b) such as copper, zinc, etc., had been clearly indicates as well that aluminium per se was not intended to be included therewith only in the primary state. Likewise the incorporation of aluminium plain sheets with aluminium corrugated sheets in entry 10 of Schedule IV of the Act by the notification dated February 15, 2002 also did not decisively signify that aluminium plain sheets had never been contemplated to be within entry 45(b) of Schedule II of the Act to be resultantly covered by the residuary Schedule III during the interregnum, he urged. Dr. Saraf has maintained that only because aluminium corrugated sheets in the wisdom of the Legislature had been subjected to double point taxation, it ipso facto does not imply that all forms of such metal would also be exigible at the same rate. As the petitioners' firm had been validly assessed for aluminium sheets at four per cent by construing the goods to be included within entry 45(b) of Schedule II, the interference therewith in the purported exercise of powers under ....

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.... liability at four per cent the impugned decision is valid and sustainable in law. The decision of the assessing authority being erroneous for which the interest of Revenue has suffered, the revisional authority was perfectly justified and within his jurisdiction to intervene under section 36, he contended. Referring to entry 45(b) of Schedule II to the Act as it existed prior to January 1, 2000, the learned standing counsel has urged that the absence of any reference of aluminium as well as the words "not finished goods" patently signify that aluminium sheets were not comprehended therein. This, Mr. Dubey has pleaded is amply testified by inclusion of aluminium sheets in entry 10 to Schedule IV to the Act as it existed before the gazette notification dated December 27, 1999. Mr. Dubey has, therefore, insisted that withdrawal of aluminium sheets from entry 10 of Schedule IV vide the notification dated January 24, 2000 and non-placement thereof in specific terms in entry 45(b) of Schedule II clearly suggested that it was intended to be covered by residuary Schedule III. While asserting that the petitioners have in their pleadings admitted aluminium sheets to be a finished product, t....

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....blished in the issue dated December 27, 1999 of the Assam Gazette whereas the rate of tax for the articles/goods included in entry 45(b) of Schedule II was enhanced to 8 paise in the rupee, the same for aluminium sheets in entry 10 of Schedule IV was also raised to eight per cent with four per cent each at the two aforementioned points of sale. As the said notification would reveal the same was to come into force on and from January 1, 2000. The fact that the petitioner-firm amongst others had represented before the State Government for reduction of the rate of tax for aluminium sheets to four per cent citing, inter alia, the trend of the various Departments and the public sector undertakings to import aluminium from outside the State at four per cent Central sales tax is a matter of record and not refuted by the official respondents. The issuance of the notification dated January 27, 2000 with effect from February 1, 2000 bringing about changes in the above-mentioned entries, is of considerable significance in this background. Not only thereby aluminium was incorporated in entry 45(b) of Schedule II with an obvious modification in the language of the text excluding from the purvi....

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....ondition and not in the shape of bars, flats and plates, their Lordships held that so long these continued to be raw materials and were processed only to render them attractive and acceptable, these did not lose their primary character. Bars flats and plates were thus held to be included within "iron and steel". The facts in Aluminium Corporation of India Ltd. [1975] 2 SCC 472, divulged that the appellant therein manufactured aluminium plates, etc., as end-products in its composite factory and with ingots, bars, etc., as intermediate ones. The matter related to a notification under the Central Excise Rules, 1944, which provided a qualified exemption to certain types of aluminium manufactured, for the purpose of excise duty. The relevant notification furnishing the description of goods maintained a clear distinction between aluminium plates, sheets, etc., and aluminium ingots, bars, etc., with varying rates of duty. In the facts of the case, aluminium sheets were held to be finished products. This decision per se does not signify that independent of any manufacturing process that may be undertaken in any factory, aluminium sheets whether plain or otherwise would inevitably be a fin....

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....c notification noticed that whereas one clause thereof envisaged metals, the other included amongst others scrapes, sheets, circles meant for making brassware, etc., and concluded that an apparent distinction between metal involved in its original saleable form and its fabricated forms as a new commodity had been consciously maintained by the framers of the notification. It was determined in this premise that aluminium rolled products and extrusions were commercial items distinguishable from aluminium ingots and billets as contemplated in the notifications. Not only the materials on record in the case in hand do not disclose any manufacturing process yielding aluminium plates from the primary metal and accepted in the commercial world as a finished product, the dichotomy discernible in the notifications in the decided case was the decisive factor therein. This decision being contingent on the foundational facts does not clinch the issue in favour of the Revenue. While proceeding to describe the characteristic features of timber and logs, the apex court in State of Orissa v. Titaghur Paper Mills Co. Ltd. [1985] 60 STC 213; [1985] (Supp) SCC 280, after an exhaustive survey of vario....

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....eets and brass sheets are distinguishable from copper and brass and are taxable at five per cent as unclassified items was rejected. The relevant entries in Schedule I of the Kerala General Sales Tax Act, 1963, being of formidable relevance deserve to be quoted:   Their Lordships noticed that copper and brass are metals and that admittedly these are produced in rolling mills in the form of sheets, circles, ingots, stripes or rods and that copper and brass in solid form are also available in the market in one of the above forms only. Their Lordships while maintaining the determination distinguished the rendering in Hindustan Aluminium Corporation Ltd. [1981] 48 STC 411 (SC); [1981] 3 SCC 578, observing that the notifications involved therein clearly indicated that the expression "metal" was used to connote it in its primary sense and that its subsequent forms as distinguished marketable commodities were regarded as new commercial goods. The apex court in Hawkins Cookers Limited v. State of Kerala [2008] 14 VST 375; [2008] 12 SCC 447, distinguished satilon coated cookware from aluminium house hold utensils for determining the correct classification thereof for the purpose of a....

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....rport of the amendments caused during the relevant time. Accommodation of any taxable commodity as a residuary item for impost under an enactment is neither a matter of routine nor an act of inferential indulgence but is an inevitable consequence impelled by the legislative layout and textual imperatives. Such a course is permissible only if determined to be indispensible, the item or commodity being unamenable to any other precise classification. The withdrawal of aluminium sheets from entry 10 in Schedule IV and assimilation of aluminium in entry 45(b) in Schedule II by the notification dated January 27, 2000 proclaims a conscious step of the lawmakers to strike a distinction between aluminium plain sheets and aluminium corrugated sheets. It cannot be gainsaid that aluminium corrugated sheets and aluminium plain sheets though varying in species are traceable to the same genus aluminium. Noticeably no specific entry was sanctioned for aluminium plain sheets by the notification dated January 27, 2000, though aluminium was added to entry 45(b). As aluminium plain sheets were exigible at eight per cent prior to January 27, 2000, the same could have been retained with aluminium corru....