IQRA TRADERS Vs. COMMERCIAL TAX OFFICER

JUDGEMENT

(1.) THE assessee is a dealer in granite. For the assessment year 1994-95, the assessee claimed exemption under Section 5(3) of the Central Sales Tax Act, 1956 ('CST Act' in short) with regard to the sale of rough granite blocks to two exporters, viz. Chettinad Granites and Apex Exports. THE Assessing Officer found that the rough granite blocks sold by the assessee were exported as polished sized granite blocks which are commercially different from rough granite blocks and therefore, the assessee cannot claim the exemption under Section 5(3) of the CST Act. THErefore, the sale of rough granite blocks was proposed for assessment under the Tamil Nadu General Sales Tax Act, 1959 ('TNGST Act' in short). Aggrieved, the assessee filed A.P. Nos.3 and 5 of 1995, which were allowed. THE Joint Commissioner, invoking his suo motu powers of revision, set aside the above orders, confirming the original orders. THE assessee thereafter filed W.P. No.10390 of 2004 with regard to the sale to Apex Exports, claiming the benefit of Section 5(3) of the CST Act. THE assessee also filed an appeal before the Tamil Nadu Sales Tax Appellate Tribunal with regard to the sale to Chettinad Granites. THE Tribunal allowed this appeal. So, the Revenue has filed W.P. No.22939 of 2004. We will deal with the facts separately and then with the submissions and the legal points together.

(2.) M/s. Chettinad Granites is a 100% Export Oriented Unit. According to the assessee, the rough granite blocks purchased by them are cut in standard sizes through sawing machines. Thus, there is no chemical process involved and there is no change in the chemical or physical composition of the goods purchased and sold.

(3.) NEXT we come to the assessee's transaction with M/s. Apex Exports. The learned senior counsel submitted that the goods were the same, that as far as this transaction is concerned, the exporter is in New Delhi and therefore, there was no local sale and the goods were straightaway exported by the assessee himself on behalf of Apex Exports and thus, there cannot be any sale nor any tax liability under the TNGST Act. Learned senior counsel also made an attempt to give a different construction to the words "in relation to" in Section 5(3) of the CST Act. According to the learned senior counsel, assuming without admitting that because of the polishing the identity of the rough blocks changed and they ceased to be those goods, this was something that was done "in relation to the export" and therefore, in any event, it would be brought under Section 5(3) of the CST Act.