M/S NEW COTTON MILLS NARWANA DISTRICT JIND Vs. THE SALES TAX TRIBUNAL HARYANA THROUGH ITS CHAIRMAN AT CHANDIGARH AND OTHERS

JUDGEMENT

(1.) THE petitioner Messrs New Cotton Mills, Narwana, is registered as a dealer under the Punjab General Sales Tax Act (hereinafter the Haryana Act) as also under the Central Sales Tax Act (hereinafter the Central Act). The petitioner has been carrying on the business of ginning and pressing of cotton in their factory at Narwana. The cotton of the customers after ginning and Dressing is compressed into cotton bales and then packed with the baling hoops and hessian cloth. The petitioner charged consolidated charges from the customers. The petitioner purchased iron hoops and hessian cloth on the basis of their registration certificate. The petitioner purchased iron hoops and hessian cloth worth Rs. 31,539/ -, Rs. 10,172 68, and Rs. 6,884 56 in 1966 -67, 1067 -68 and 1968 -69 respectively on the basis of registration certificate without payment of sales -tax. The Assessing Authority served notices on the petitioner in respect of the said three years and assessed the petitioner to tax at 6 per cent on the iron hoops and hessian cloth so purchased. The petitioner was assessed to Rs. 1892.34 as tax for 1966 -67 vide order Annexure 'C' to Rs. 610.38 for 1967 -68 vide order Annexure 'C I and to Rs. 413.10 for 1968 -69 vide order Annexure 'C. 2'. The Assessing Authority also imposed penalty for 1967 -68 and 19(58 -69 under the Haryana and the Central Acts. The petitioner contested its liability to pay sales -tax on the purchase of iron hoops and hessian cloth on the ground that the same was resold in the course of business. The plea was not accepted by the Assessing Authority. The petitioner having failed on this point before the appellate authority and Sales Tax Tribunal has filed the present writ petition.

(2.) THE contention of the Learned Counsel for the petitioner is that hessian and iron hoops purchased by the petitioner on the registration certificate were used as packing material for cotton which was being pressed on labour contract basis. The petitioner accepted composite charges both for pressing the cotton and supplying the packing material. The petitioner thereby resold the packing material to the customers whose cotton was pressed. The petitioner thus did not misuse the registration certificate and has been wrongly made liable to pay sales -tax on this account. Reliance has been placed Jaikishan Gopikishan v. Commissioner, Sales -tax, M.B. : A.I.R. 1957 M.P. 40 and The Nimar Cotton Press Through Proprietor, N&reman Sorabji Kerawala, Pandhara Road. Khandwa v. Sales Tax Officer, Nimar Circle, Khandwa : A.I.R. 1961 M.P. 88. The Learned Counsel for the State has argued that the Assessing Authority has found as a fact that the petitioner did not sell packing material, including the hessian and the iron hoops to the customers. It was within the competency of the Assessing Authority to record a finding on this point. This finding which even otherwise is correct cannot be assailed in writ proceedings. Reliance has been placed on Mewar Sugar Mills Ltd and others v. State of Rajasthan : A.I.R. 1970 Raj. 1.

(3.) IT has been held, in Jaikishan Gopikishan's case (supra) that the owner of a ginning and pressing factory carrying on the business of baling and processing cotton supplied by the customers and of delivering the pressed cotton in the form of bales covered with hessian cloth and secured by iron hoops, and making a consolidated charge for pressing as well as packing is a dealer within the meaning of the Madhya Bharat Sales tax Act. The hessian and iron hoops used in the baling process are goods and there is a sale in regard to them when the assessee transferred the property in these goods.