LUTHRA RUBBER INDUSTRIES Vs. STATE OF PUNJAB

JUDGEMENT

(1.) THIS judgment of ours would dispose of this and other connected petitions (i. e. , C. W. P. Nos. 3389, 3390, 3391, 3392, 3393, 3394, 3395 and 1947 of 1984) as common question of law arises in all these petitions. In order to appreciate the controversy, certain salient features from this petition may be noticed : The petitioner is a registered dealer both under the Punjab General Sales Tax Act and the Central Sales Tax Act (hereinafter referred to as Punjab Act and Central Act respectively) in the manufacture and sale of transmission rubber beltings. The petitioner filed its returns in accordance with law for the assessment year 1967-68 (Central ). The transmission rubber beltings both under the Punjab and the Central Acts were held not to be taxable by the Assessing Authorities in view of the judgment of the Sales Tax Tribunal in Allied Rubber and Plastic Industries, Jullundur v. State of Punjab dated 29th February, 1968. However, tax under the second proviso to Section 5 (2) (a) (ii) was levied on the raw material purchased for the manufacture of transmission rubber beltings as the raw material was purchased on the strength of the registration certificate. The tax as determined under the second proviso was deposited by the petitioner. Copy of the order passed by the Assessing Authority is attached with the petition as annexure P-1.

(2.) IT is further averred in the petition that some of the Assessing Authorities in District Bhatinda took a view different from the one which was prevailing in the past and held that transmission rubber beltings were not exempted under items 30, 30-B and 30-C of Schedule B of the Act and imposed tax on the sales so made by the assessee. Feeling aggrieved from the orders of the Assessing Authorities, the matter was taken up before the Sales Tax Tribunal, Punjab, Chandigarh and the Presiding Officer of the Sales Tax Tribunal in cases of M/s. Brij Cycle Works, M/s: Laxmi Machinery Stores and M/s. Jain Hind Mills held that the said item was not tax-free and was exigible to tax, vide its order dated 8th January, 1973.

(3.) DISSATISFIED from the order of the Sales Tax Tribunal, the matter was agitated before this Court, but the assessee did not succeed and a Division Bench of this Court in Laxmi Machinery Store v. State of Punjab [1977] 39 STC 87 maintained the order of the Tribunal and held that the transmission rubber beltings were taxable and did not enjoy exemption under entry 30-B or 30-C of the Act.