BHOGILAL DEVCHAND AND SONS Vs. STATE OF MAHARASHTRA

JUDGEMENT

(1.) This is a reference under section 61(1) of the Bombay Sales Tax Act, 1959 (hereinafter referred to as "the said Act"). The question referred to us for our determination are as follows :

(2.) The facts giving rise to this reference are as follows : The applicants are a partnership firm registered under the said Act as a dealer as well as a purchasing commission agent. During the period from 18th October, 1963, to 4th November, 1964, they purchased unpolished stainless steel utensils, which have been described by the Tribunal in its statement of facts as semi-finished stainless steel utensils against declarations in form 17 on the strength of the permit held by them. These purchases were effected by the applicants on behalf of their principles who were dealers at Ahmedabad and were registered there under the very same Act, viz., the said Act, as enforced in the Gujarat State, as well as under the Central Sales Tax Act, 1956. The total purchases effected by the applicants on behalf of their aforesaid principles were to the tune of Rs. 8,07,903. Out of these purchases, unpolished utensils worth Rs. 6,05,624 were consigned by the applicants to their said principals at Ahmedabad in the same form in which they were purchased. As regards utensils worth Rs. 27,141, which were consigned to the principals in the same form in which they were purchased, there was some difficulty regarding the proof of consignment, but, in this reference, we are not concerned with the same. The remaining utensils worth Rs. 1,75,138 were consigned by the applicants to their said principals after getting them polished at Bombay at the instance of their principles. It is in connection with these utensils that the dispute has arisen before the Tribunal from which this reference arises. When the said utensils were purchased by the applicants the price thereof was debited by them to the account of their Ahmedabad principals. The applicants also sent their statement of accounts by way of intimation to their said principals. The said unpolished utensils worth Rs. 1,75,138 were got polished by the applicants in Bombay and consigned to their principals at Ahmedabad as aforesaid within three months of their purchase as unpolished utensils.

(3.) In assessing the applicants for the aforesaid period the Sales Tax Officer concerned held that the applicants had contravened the recitals of declarations in form 17 issued by them at the time of their purchases of the goods worth Rs. 2,02,279 which included the said utensils worth Rs. 1,75,138. The appeal preferred by the applicants before the Assistant Commissioner of Sales Tax was dismissed. The applicants then went by way of second appeal before the Sales Tax Tribunal. The Tribunal rejected the appeal of the applicants in respect of the said goods worth Rs. 1,75,138. The Tribunal held that the goods purchased by the applicants against declarations in form 17 could not be said to be the same goods as were consigned to their principals for the purpose of section 11(2) of the said Act. The Tribunal held that unpolished utensils, which were referred to by the Tribunal as "semi-finished" utensils, purchased by the applicants on behalf of their principals had no marketability. The Tribunal further held that the goods in question were manufactured by the applicants because they had got them polished before despatch. It is from this decision of the Tribunal that the aforesaid questions have been referred to us for determination.