KOEL SALES AND SERVICE Vs. STATE OF MAHARASHTRA

JUDGEMENT

(1.) THIS is a reference under section 61 of the Bombay Sales Tax Act, 1959 (hereinafter referred to as "the Act"), made at the instance of the applicant and the short question which arises is whether oil engine is agricultural machinery or constitutes only a component or part of agricultural machinery ?

(2.) THE facts leading to this reference are these : THE applicant is a manufacturer of diesel oil engines which are used as prime movers of pumping sets. On 26th April, 1974, the applicant filed an application under section 52 of the Act for determining the question as to whether the sale of prime mover oil engine of the description given in Invoice No. E/01/40803 to M/s. Kelkar Bros. , Poona, will fall in entry No.22 of Schedule E, or whether the said prime mover oil engine is covered by entry No.12 of Schedule C to the Bombay Sales Tax Act, 1959. For our purpose it is not necessary to refer to the detailed description of the oil engine in the said invoice. All that is to be borne in mind is that oil engine in question acts as a prime mover for the pumping sets used by agriculturists. THE Commissioner of Sales Tax rejected the case of the applicant that the oil engine was not agricultural machinery by itself but it was only a component of the agricultural machinery and therefore, attracted the levy of tax under entry No.12 of Schedule C and not under the residuary entry No.22 of Schedule E. THE applicant then filed an appeal before the Tribunal. However, the Tribunal upheld the view taken by the Commissioner and dismissed the appeal. On the application of the applicant, the Tribunal has framed the following question of law for our determination : " Whether the Honourable Tribunal was justified and right in holding that an oil engine of the type of Kirloskar AV1, 5 HP, 1500 RPM complete with standard tools and accessories is not covered by entry No.12 as amended with effect from 11th May, 1973, of Schedule C, but is covered by entry No.22 of Schedule E appended to the Bombay Sales Tax Act, 1959 ?"

(3.) IT may be noticed that in the original entry No.12 as it stood prior to the amendment, there was no specific reference to tractors, oil engines and electric motors. However, even parts of agricultural machinery attracted levy under entry No.12 and therefore if oil engine is considered as a part of agricultural machinery it was liable to tax under entry No.12 and not under the residuary entry. If that was the position, there was no point in amending entry No.12 so as to exclude oil engine from agricultural machinery, because though it did not constitute agricultural machinery by itself still being part of agricultural machinery it continued to fall under entry No.12. If oil engine was a part or component, the original entry No.12 before amendment by itself would have covered the oil engine as being part of such machinery and there was no need to amend the entry so as to specifically exclude oil engine from agricultural machinery, but in fact included it to retain its original position as a component or a part of agricultural machinery falling under the same entry. On a plain reading of the amended entry, it is clear that the legislature treated the three items, viz. , oil engines, electric motors and tractors, as agricultural machinery as contemplated by entry No.12. Assuming that oil engine could be treated as merely a part or component of agricultural machinery as contended by the learned counsel, still there is no doubt that the legislative intended to exclude these three items from the purview of entry No.12. Otherwise the amendment would make no sense and would become nugatory as far as oil engines are concerned.