KODE INDUSTRIAL CHEMICALS Vs. STATE OF KERALA

JUDGEMENT

(1.) ASSESSEE is the petitioner. The year of assessment is 1991. The question for consideration in this case is whether the nickel catalyst is used as raw material in the manufacture of soaps. The petitioner is the manufacturer of nickel catalyst. According to the petitioner, the sale of nickel catalyst was fully to M/s. Kerala Soaps and Oils Limited, Kozhikode which was a company fully owned by the Government of Kerala. The purchasing company represented to the petitioner that the nickel catalyst purchased by it is for use as raw material in the manufacture of soaps and that it will issue form 18 declaration to the petitioner so that the rate of tax is only 2 per cent under section 5 (3) of the Kerala General Sales Tax Act, 1963 read with rule 28 of the Kerala General Sales Tax Rules, 1963. Accordingly, the petitioner raised invoices on M/s. Kerala Soaps and Oils Limited. Kozhikode charging sales tax at the rate of 2 per cent and the company issued form 18 declaration to the petitioner which were produced before the assessing authority. However, the assessing authority issued notice to the petitioner stating that a catalyst cannot be called a raw material and therefore concessional rate of 2 per cent cannot be allowed on the local sales of nickel catalyst.

(2.) THE petitioner filed an appeal, which was dismissed. THEn it filed a second appeal before the Tribunal. THE Tribunal also dismissed the appeal. It is against that the present revision is filed.

(3.) IN the above view of the matter, we are of the view that nickel catalyst can be treated as a raw material. We set aside the orders of the authorities and direct the assessing authority to complete the assessment as per the directions in the judgment. Tax revision case is allowed. Petition allowed. .