TMI Blog1994 (8) TMI 248X X X X Extracts X X X X X X X X Extracts X X X X ..... ngh, Advocate, with him), for the appellants. P.P. Rao, Senior Advocate (Vivek Gambhir and Suman Khaitan, Advocates, for M/s. Khaitan Co., with him), for the respondents. -------------------------------------------------- The judgment of the Court was delivered by S. MOHAN, J.- Leave granted. Respondent No. 1 is a private company. The respondent No. 2 is one of the directors-cum-shareholders. The respondent purchases raw petroleum product. This product undergoes a process of manufacture in the factory. The ultimate commodity is calcined petroleum coke (hereinafter referred to "C.P.C."). The respondent was subject to sales tax under the Bihar Finance Act, 1981 (hereinafter referred to as "the Finance Act") on the sale of C.P.C. as well as the Central Sales Tax Act, 1956 (hereinafter referred to as "the Act"). The respondent stated that he missed to claim the adjustment of sales tax paid on the purchase of raw materials in the returns filed for the months of July and August, 1990. The admitted tax due thereon was paid. In terms of section 15(b) of the Act, the respondent was entitled to a refund of sales tax paid under the Finance Act. While filing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Pyare Lal Malhotra [1976] 37 STC 319; AIR 1976 SC 800 it should be held if R.P.C. has undergone a process of manufacture which ultimately results in C.P.C., it is a different product for the purpose of taxation. In the field of taxation, the State has a wide choice in choosing the object of taxation. In this case, one added feature is that for the purpose of excise duty, R.P.C. is treated differently than C.P.C., both the products being subject to separate excise duty. Therefore, it is prayed that the judgment of the High Court be set aside and the order of the Joint Commissioner be restored. In opposition to this, learned counsel for the respondents urges that there is a wide distinction between entry under section 14(ia) of the Central Sales Tax Act relating to coke in all forms and section 14(iv) iron and steel, "that is to say". Because of this peculiar phraseology "that is to say", the ruling of Pyare Lal case [1976] 37 STC 319 (SC); AIR 1976 SC 800 came to be so laid down but here, there is no such difficulty, having regard to the nature of the entry. The same principle came to be adopted with regard to "oil-seeds" in Sait Rikhaji Furtarnal v. State of Andhra Pradesh [1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hen exemption was sought to be claimed on the ground that both these items will fall under section 14(ia) of the Act, that was rejected by the Joint Commissioner. He took the following view: "It is not disputed that the raw petroleum coke and the calcined petroleum coke, though different commercial commodities, are both declared goods. In order to entitle inter-State sale of such goods to avail the benefit of section 15(b) of the Central Sales Tax Act, the same goods as subjected to inter-State levy of tax must be sold in the course of inter-State trade or commerce. The expression 'such goods' used in section 15(b) quoted above and underlined by me is very significant in the matter. Once the particular goods which had earlier been subjected to inter-State tax in the State was again put to a process of manufacture, it loses its original identity and emerges as another form of finished product though still remaining a declared goods. To cite an example, case of steel scrap or billets rolled into different kinds of steel materials may be taken. When these are purchased as raw materials within a State after being subjected to State tax at 4 per cent being declared goods and are the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... troleum coke has lost its original identity and has resulted in a new product, namely, calcined petroleum coke. Therefore, according to him, the benefit under section 15(b) of the Act could be availed of only if the same goods are subject to inter-State levy of tax. He opined the use of words "such goods" under section 15(b) of the Act are of significance. We are totally unable to accept this line of reasoning. Once the entry is "coke in all its forms" irrespective of the fact raw petroleum coke loses its original identity or in the process of manufacture calcined petroleum coke is produced, cannot take calcined petroleum coke out of the purview of this entry. In more or less identical situation, this Court held in India Carbon's case [1971] 28 STC 603; AIR 1972 SC 154 that petroleum coke is one form of coal governed by the expression "coal" within section 14(ia). The relevant extract of the judgment is as under: "It is not disputed that if petroleum coke is covered by clause (i) of section 14 which reads 'coal including coke in all its forms' the State was not competent to levy tax at a rate exceeding the one given in section 15(a) of the Central Act. ..................... ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may be a form of leather or may even be said to represent a different commercial commodity. The statutory entry is comprehensive enough to include the products emerging from hides and skins until the process of dressing or finishing is done." (Emphasis supplied) This is enough to conclude the case against the appellant. However, since reliance is placed on Pyare Lal Malhotra's case [1976] 37 STC 319 (SC); AIR 1976 SC 800, we have to make a brief reference to the same. That case dealt with the scope of the entry 14(iv) of the Act, iron and steel "that is to say". The interpretation of this phrase "that is to say" loomed large. It was held in paragraphs 13 and 14 (page 326 of STC; 806 of AIR), as under: "It is true that the question whether goods to be taxed have been subjected to a manufacturing process so as to produce a new marketable commodity, is the decisive test in determining whether an excise duty is leviable or not on certain goods. No doubt, in the law, dealing with the sales tax, the taxable event is the sale and not the manufacture of goods. Nevertheless, if the question is whether a new commercial commodity has come into existence or not, so that its sale is a new ..... X X X X Extracts X X X X X X X X Extracts X X X X
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