RADHIKA Vs. STATE OF ORISSA

JUDGEMENT

(1.) AT the instance of the assessee, two questions have been referred under section 24 (1) of the Orissa Sales Tax Act (hereinafter referred to as the "act"), for opinion of the court :

(2.) THE petitioner carries on business in the name and style of "m/s. Radhika" at Cuttack and deals in mill-made cloth. Some of the items sold by the dealer are pillow covers which are stitched on three sides, bed sheets stitched at the two ends, towels cut into pieces and napkins stitched at both ends. The assessee claimed that these were not liable to sales tax. The assessing officer, however, overruled the assessee's stand and completed assessment for the quarter ending 31st March, 1968, under section 12 (5) of the Act. Subsequently, the assessee was assessed for the periods 1968-69, 1969-70 and 1970-71 also under section 12 (5) of the Act and with these assessments we are now concerned. The assessee contended while challenging the assessments that the items were mill-made goods and came within entry No. 33 relating to tax-free items. The assessee's contention has been rejected throughout.

(3.) AS far as pillow covers are concerned, the Tribunal found that pillow covers are made by cutting into different sizes, stitching and making them ready for use in a particular way. The operation is neither incidental nor ancillary to the process of manufacture and there is a change of substantial nature. In view of this finding, we would agree that pillow covers would not come within the exemption.