STATE OF TAMIL NADU Vs. VINYL CABLE INDUSTRIES

JUDGEMENT

(1.) THESE three petitions arise out of a common judgment of the Tamil Nadu Sales Tax Appellate Tribunal, Main Bench, Madras. The assessees/ respondents were assessed for the years 1973-74 and 1974-75 under the Tamil Nadu General Sales Tax Act, 1959, as well as the Central Sales Tax Act, 1956. In their eventual appeals before the Tribunal the following facts transpired. The petitioners were first assessed on a total and taxable turnover of Rs. 13, 81, 946 and Rs. 13, 73, 449, respectively and assessed at different rates for the year 1973-74. The assessing officer however subsequently found that in respect of a portion of the sales of PVC cables the petitioners had manufactured auto cables also and sold them to various automobile parts dealers. It is accordingly found that in the said assessment year they had sold such auto cables worth Rs. 4, 69, 157.53. Although in the original assessment, these items were also treated as electrical goods and taxed at 9 per cent as the rate then was, as it had been found that the petitioner had collected only 9 per cent from the buyers, the assessing officer came to the conclusion that such sales were to be taxed at 13 per cent under item 3 of the First Schedule. Similarly under the Central Sales Tax Act, the petitioners were assessed on a total and taxable turnover of Rs. 4, 51, 675 and Rs. 4, 45, 614, the taxable turnover comprising of tax due at 10 per cent on a turnover without "C" form Rs. 15, 466 and tax due at 3 per cent on a turnover with "C' form Rs. 4, 30, 148. Similarly, for the year 1974-75, PVC, cables were taxed at the rate of 9 per cent on the taxable turnover originally determined at Rs. 15, 25, 228 including sale of cables taxed at 9 per cent, the turnover for the same being Rs. 4, 12, 907 which was later brought to tax at 13 per cent. The only point of dispute before the Tribunal was the rate of tax, i.e., whether PVC cables allegedly sold to the automobile parts dealers was taxable under entry 3 of the First Schedule of the Tamil Nadu Sales Tax Act or under entry 41 thereof. The Tribunal found however that the PVC cables were to be taxed as electrical goods as in entry 41 and at the relevant time the rate was 9 per cent only.Entry 41 reads as follows: " *

(2.) THE usage for purpose of automobile is only one of the manifold uses; that the name 'auto cable' is merely used to explore particular line of business and cannot determine the issue involved. It is further urged that the cables have to undergo certain changes such as cutting the cables, fixing of sleeves and fixing of terminals or bushes; that after these operations, a cable sub-assembly is made for the specification ............. THE learned authorised representative for the appellants placed before us a sample of the cables. It is seen that the appellants sold PVC cables of lengths of 25 metres, 100 metres, etc., whereas a smaller length is actually used in an automobile. It is further clear from the facts mentioned earlier that the sales of PVC cables at Rs. 5, 31, 315 were first brought to tax in original assessment and only a turnover of Rs. 4, 69, 158 is now sought to be taxed at 13 per cent. This itself indicates that a portion of the turnover relates to sales of PVC cables to customers other than dealers in automobiles. Item 3 of the First Schedule uses the expression articles (excluding batteries) adopted for use generally as parts and accessories of motor vehicles and trailers. It cannot be said that the cables sold by the appellants are adopted for use as parts and accessories of the motor vehicles. As rightly pointed out by the learned authorised representative for the appellants, some modification has to be made before the cables from item 3 of the First Schedule (sic) that unless a particular article of general use was adopted for use as accessories of motor vehicle, the entries would not apply."