STATE OF ORISSA Vs. ANTARYAMI PANIGRAHI

JUDGEMENT

(1.) THE Member, Additional Sales Tax Tribunal, Orissa, has stated this case and referred the following two questions for opinion of the court under section 24 (1) of the Orissa Sales Tax Act, 1947 (hereinafter referred to as the "act") :

(2.) THE assessee is a registered dealer under the Act and dealt inter alia in siali leaves during the period ending 1966-67. He purchased siali leaves and paid tax on the purchased turnover. On a finding that the assessee had, after purchase of siali leaves, pinned them up and had sold them as siali khallis and thus had converted siali leaves into a new commodity, the assessing officer levied tax of 5 per cent on the sale turnover of khallis. On the assessee's appeal, the Assistant Commissioner of Sales Tax found that siali leaves and khalli were two different commodities and sales turnover thereof was liable to tax under section 5 (1) of the Act. The Tribunal in second appeal by the assessee observed :

(3.) THE learned standing counsel contends that siali leaves and khalli are two different commercial commodities and one in not a substitute of the other. A customer in need of khallis would not accept siali leaves in satisfaction of his demand in the market. Since they are two different commercial commodities, according to the learned standing counsel, the Sales Tax Officer and the first appellate authority were right in holding that the sales turnover of khallis was liable to tax and the Additional Sales Tax Tribunal went wrong in holding that sale of khallis was exempt from a fresh set of tax as purchase tax had already been paid on it. We are of the view that the principle indicated by a Bench of three learned Judges of the Supreme Court in the case of Deputy Commissioner of Sales Tax, Ernakulam v. Pio Food Packers [1980] 46 STC 63 (SC); AIR 1980 SC 1227 had rightly indicated the guideline. The court in that case was considering whether whole pineapples when converted into canned pineapple slices constituted a different commodity. The court observed :