STATE OF GUJARAT Vs. GUJARAT ENGINEERING COMPANY

JUDGEMENT

(1.) THE following question has been referred to us for our opinion by the Gujarat Sales Tax Tribunal : " Whether, on the facts and in the circumstances of the case, for the purpose of levy of tax, oil engines prior to 14th March, 1960, and spare parts thereof prior to 27th September, 1960, fall under entry 15 of Schedule C to the Bombay Sales Tax Act, 1959, or fall under entry 22 of Schedule E to the said Act ?"

(2.) THE question arises in the following circumstances : THE opponent-firm is a partnership firm dealing in manufactur and sale of oil engines and spare parts thereof. It is registered under the Bombay Sales Tax Act, 1959. It was assessed for two periods, viz. , (i) 1st January, 1960, to 31st March, 1960, and (ii) 1st April, 1960, to 31st March, 1961, by separate assessment orders passed by the Sales Tax Officer, holding that oil engines and spare parts therefore are covered by entry No. 15 of Schedule C to the Act. THE Assistant Commissioner of Sales Tax initiated suo motu revision proceedings against this assessment and held that the oil engines and spare parts thereof prior to the aforesaid respective dates were covered by the residuary entry No. 22 of Schedule E to the Act.

(3.) IT was contended on behalf of the State that the entry in question presupposes that there must be actual user of the machinery for purposes of manufacturing goods, as the machinery may be put to different uses according to the exigencies of the case. In the particular case before the Tribunal, it was urged on behalf of the revenue that the oil engines would not necessarily be required to be used for purposes of manufacturing goods, but should be as well be put to uses other than manufacturing of goods, namely, lifting of water from the well, etc. On behalf of the assessee-opponent-firm herein, it was contended that there is no warrant for reading the entry in the manner in which it has been urged on behalf of the State. If the machinery is one, which could be used for the manufacturing of goods, it should be considered sufficient to attract the tax under entry No. 15.