COMMERCIAL TAXES OFFICER Vs. MAGNIRAM HARIRAM BEAWAR

JUDGEMENT

(1.) A .P. Sen, J 1. This is an application under Section 15(2)(b) of the Rajasthan Sales Tax Act, 1954 by the Commercial Taxes Officer, Beawar, requiring the Board of Revenue to refer the following question of law: Whether under the facts and circumstances of the Board of Revenue was justified in holding that there was no implied sale of packing material even though snuff was sold as packed and the value of the container had also been taken into account for fixing the sales price

(2.) M /s. Magniram Hariram, Beawar, hereinafter referred to as the 'assessee', is engaged in the business of manufacture and sale of snuff. For the year 1968 -69, the assessing authority found that the assessee sold snuff packed in the containers by way of inter -State sale to the extent of Rs. 3,38,871.56 P. The snuff (tobacco) was exempt from sales tax. The account books revealed that the containers in which the snuff was packed were worth Rs. 48,264.93 i.e., 15% of the sale price. The assessing authority held that the value of the packing material being very substantial, the sale of goods in the course of inter -State trade, involved an implied sale of packing materials. He accordingly, brought the tin containers, to tax @ 3% under the Notification dated 29 -5 -1967 issued under Section 8(5) of the Central Sales Tax Act, The tax so determined came to Rs. 1,447.95 P.

(3.) IN special appeal, a Division Bench of the Board of Revenue agreed with the interpretation of the last proviso to Section 5 of the Rajasthan Sales Tax Act in its earlier decisions viz., that where there was no rate applicable to the goods then no rate can apply to the packing materials also. The Division Bench did not specifically decide the point whether there was an implied sale of the tin, containers or not, but distinguished (1973) 31 STC 53 as not applicable.