A ANTHONY SWAMY Vs. STATE OF KERALA

JUDGEMENT

(1.) THE same assessee is the petitioner in both the cases. THE Revenue is the common respondent in the revisions. We are concerned with the assessment years 1985-86 and 1986-87. THEse revisions are filed against the common order passed by the Kerala Sales Tax Appellate Tribunal, Thiruvananthapuram (in short, "the Tribunal") in Tribunal Appeal Nos. 90, 96 and 442 of 1988 and Cross Objection Nos. 23 and 56 of 1988. THE common order is dated February 25, 1991.

(2.) THE only question that is canvassed in these revisions is about the interpretation placed by the Tribunal on S. R. O. No. 968/80 - G. O. Ms. No. 74/80/td dated September 29, 1980. THE question is whether the assessee, who is the owner of a small-scale industry, is entitled to the tax exemption as provided in the above Government notification. THE Tribunal negatived the plea of the assessee and held that the assessee's unit is not eligible for exemption as envisaged in the Government Notification, S. R. O. No. 968/80. THE question is, whether the said interpretation, placed by the Tribunal, on S. R. O. No. 968/80, is justified in law.

(3.) COUNSEL for the assessee Mr. Nambiar stressed the plea that after explanation (3a) to section 2 (xxi) of the Kerala General Sales Tax Act (in short, "the Act"), a transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract shall be deemed to be a sale and on this basis, since the State is enabled to levy sales tax on the price of goods and materials used for works contract, there is a sale of goods and materials and so the assessee will be entitled to the exemption in respect of the entire consideration received by way of retreading charges. On the other hand, learned Government Pleader contended that after the amendment of definition by adding explanation (3a) to section 2 (xxi) of the Act, what is taxable is only a transfer of property in goods involved in the execution of a works contract and this involved only deemed sale of the goods involved in the execution of the works contract. This is not a case where, as a result of any process, there is a sale of the goods produced, i. e. , the sale of the retreaded types. The assessee will not come within the letter of the Notification - S. R. O. No. 968/80 - and so the Tribunal was justified in denying the relief.