ELTEX ENGINEERING CORPORATION PRIVATE LIMITED Vs. JOINT COMMERCIAL TAX OFFICER AVANASHI ROAD DIVISION COIMBATORE 12

JUDGEMENT

(1.) THE petitioners are dealers in electrical motors, agricultural pump-sets, etc. THEy sold electrical motors to Messrs. Elgi equipments Private Limited, Coimbatore, who in their turn gave what is popularly known as form XVII declarations under which they declared that the goods were purchased for use as component parts of other goods specified in the First Schedule and intended for manufacture inside the State and to be sold inside the State. It is not in dispute that such declarations as prescribed were produced by the petitioners before the assessing authority. One feature as contained in the Act is that if such declaration are obtained by a seller in the prescribed form, then such dealer would be entitled to a concessional rate of tax under section 3 (3) of the Tamil nadu General Sales Tax Act for all such sales effected by him and covered by the declaration forms. THE petitioners having so effected the sales and having produced the requisite declaration forms before the assessing authority, claimed to be assessed at the concessional rate on a turnover of Rs. 4, 08, 312 for the assessment year 1966-67. But the respondent who is the assessing authority in this case, denied the right to such a concession on the ground that the electrical motors sold by the petitioners can be considered only as accessories as providing motive power and not as components as meant in section 3 (3 ). Aggrieved by this order wherein the concessional rate of tax has been denied, the petitioner has come up to this court for a rule of certiorari to quash that portion of the offending order of the respondent. Section 3 (3) undoubtedly postulates a concession in the rate of tax provided the limbs of that section are satisfied. One of the requisites to gain the concessional rate is to sell goods to another for use by the latter as component parts of any other goods mentioned in the First schedule which the other intends to manufacture inside the State for sale.

(2.) THE motors were declared by the purchaser as so required to be used as component parts for the other manufacturable goods. Once the declaration is made by the buyer in the prescribed form and as required by the statute, no other proof of any other circumstance is required to enable the petitioner to gain the concessional rate in section 3 (3) of the Act. In the order, the assessing authority would say that the motors were used as accessories but not as components. THE very fact that it is not in dispute that motors which are the subject-matter of the sale were used as accessories, it means it became part and parcel of the manufactured product itself, which automatically would make it a component of it. I am unable to accept the reason given by the respondent, on the foot of which the concession has been denied. As a matter of fact, this very question loomed barge in a case reported in Premier Electro-Mechanical Fabricators v. State of Madras wherein a Division Bench of this court, to which I was a party, observed : "the manner in which the seller has to satisfy the third requisite is as provided in the proviso to the sub-section, namely, production of the declaration in the prescribed form. " Two other requisites referred to in the decision are : " (1) THE goods, which are the subject-matter of sale, should be those mentioned in the First Schedule, (2) the sale must be to another dealer. " *