COMMISSIONER SALES TAX Vs. SARIN TEXTILE MILLS

JUDGEMENT

(1.) IN these three connected cases the common question of law that arises is as to whether the turnover of woollen yarn manufactured by the assessee should be taxed under section 3 at the rate of 2 per cent. or should be assessed as "yarn" or "woollen goods" under the notifications issued under section 3-A. If it is assessable as yarn, its turnover would be assessable at the rate of six pies per rupee for the assessment year 1959-60 and at the rate of 3 per cent. for the year 1961-62 and if it is covered by the term "woollen goods" then it would be assessable at the rate of one anna per rupee. The notifications with which we are concerned are :

(2.) THE assessee is engaged in the business of manufacture and sale of woollen carpet yarn or kati. There is no dispute about the quantum of the turnover. The dispute relates only to the rate of tax. The assessee's contention was that the carpet yarn or kati was an unclassified item not covered by any of the notifications referred to above and its turnover was therefore assessable under section 3 at multiple point at the rate of 2 per cent. The Sales Tax Officer, however, did not agree with this contention and held that the commodity in question was yarn and assessed its turnover at the rate of 6 pies per rupee for the assessment year 1959-60 and at the rate of 3 per cent. for the year 1961-62 as prescribed in notifications 1 and 2 referred to above.

(3.) THE first question that arises is as to whether the commodity in dispute is woollen yarn and, if so, whether it is covered by the notifications Nos. 1 and 2 referred to above. It would be noticed that there is no material difference for the purposes of the question referred in the notification Nos. 1 and 2 except the difference in the rate. The term "yarn" has not been defined in the Act. The Assistant Commissioner (Judicial) has quoted the meanings of this term as given in various dictionaries as below :