VAISWANER TRADING CO Vs. STATE OF GUJARAT

JUDGEMENT

(1.) ON the application of the applicants under section 27 of the Bombay Sales Tax Act, 1953, the Deputy Commissioner of Sales Tax determined that rivetted baling hoops sold by the applicants under their bill No. 293 dated 7th November, 1958, were not covered by any specific entry in any of the Schedules to the Act, and, therefore, fell within the residuary entry 80 in Schedule B to the Act. The contention of the applicants was that rivetted bailing hoops were rolled steel sections sold in the same form in which they were directly produced by the rolling mills and were, therefore, covered by entry 4(d)(iv) in Schedule AA to the Act. This contention was negatived by the Deputy Commissioner of Sales Tax who agreed that rivetted baling hoops were rolled steel sections but took the view that they were not sold in the same form in which they were directly produced by the rolling mills and did not, therefore, come within entry 4(d)(iv) in Schedule AA to the Act and since they were not claimed to fall within any other specific entry the residuary entry 80 in Schedule B to the Act applied for determining the rate of tax. The applicants being aggrieved by the decision of the Deputy Commissioner of Sales Tax preferred an appeal to the Tribunal. A contention was sought to be raised before the Tribunal on behalf of the department that rivetted baling hoops were not rolled steel sections at all nor were they any other variety of iron and steel specified in entry 4(d) of Schedule AA and that that entry had, therefore, no application to rivetted bailing hoops. This contention involved the determination of a question of fact which would necessitate the leading of fresh evidence and besides, it was contrary to the assumption on which the department had proceeded until then since in a Bulletin issued in 1960 by the department, baling hoops were shown under the main classification of rolled steel sections and were stated to be covered by entry 3(d)(iv) of Part I of Schedule B to the Bombay Sales Tax Act, 1959, which corresponded to entry 4(d)(iv) in Schedule AA to the Bombay Sales Tax Act, 1953, and the Deputy Commissioner of Sales Tax had also proceeded on the basis that rivetted baling hoops were rolled steel sections. The Tribunal, therefore, did not permit this contention to be raised and proceeded to decide the appeal on the basis that rivetted baling hoops were rolled steel sections. The only controversy which then remained was whether rivetted baling hoops were rolled steel sections sold in the same form in which they were directly produced by the rolling mills. The Tribunal determined this controversy in favour of the department holding that once small pieces of rolling steel sections were joined together by rivetting, the form was altered because after rivetting they were not the same continuous smooth strips which were directly produced by the rolling mills and they lost their characteristic of a raw material. The Tribunal accordingly upheld the decision of the Deputy Commissioner of Sales Tax and it is this view of the Tribunal which is now challenged before us on this reference.

(2.) NOW in order to appreciate the arguments which have been advanced before us, it is necessary to examine briefly the history of the enactment of entry 4 in Schedule AA under which the applicants claim, rivetted baling hoops are liable to be taxed. There was originally in Schedule B, entry 15, which was in terms : "Iron and Steel". The general sales tax chargeable on this category was six pies in a rupee and the purchase tax was three pies in a rupee. An amendment was made in this entry was effect from 8th April, 1957, and after the amendment, the entry read as follows :- "Iron and steel, that is to say - (a) pig iron and iron scrap; (b) iron plates sold in the same form in which they are directly produced by the rolling mill; (c) steel scrap, steel ingots, steel billets, steel bars and rods; (d) (i) steel plates, ---- | (ii) steel sheets, | sold in the same | form in which they (iii) steel bars and tin bars, | are directly produced | by the rolling mill." (iv) rolled steel sections, | | (v) tool and alloy steel. ----

(3.) WE may point out at the outset that it was common ground between the parties that rivetted baling hoops were rolled steel sections and the only question debated before us was whether they were sold in the same form in which they were directly produced by the rolling mills. Now when can an article which is a rolled steel section be said to be in the same form in which it is directly produced by the rolling mill is a difficult question to decide and so various are the considerations which must enter into the determination of the question that it is impossible to attempt to formulate a general test which must be applicable in all cases. By the very nature of the subject-matter no straight jacket formula can be devised or even contemplated which would take in all cases covered by the entry and yet not leave out some. Human ingenuity is to great and so numerous are the ways in which having regard to scientific and technological progress articles like rolled steel sections can be made use of that we think it would be unwise to formulate, even if we could, an inclusive or exclusive test defining the content of the entry in so far as it relates to rolled steel sections sold in the same form in which they are directly produced by the rolling mills. WE should confine our task only to the determination of the limited question before us, namely, whether on the facts and circumstances of the present case rivetted bailing hoops can be said to be rolled steel sections sold in the same form in which they are directly produced by the rolling mills. WE must consider these goods and ask ourselves the question : are these goods rolled steel sections in the same form in which they are directly produced by the rolling mills and if we ask this question to ourselves, it is clear that whatever difficulty there may be in defining precisely and exhaustively the true meaning of the entry, there is no difficulty in arriving at a solution of the problem before us.