TMI Blog1985 (8) TMI 346X X X X Extracts X X X X X X X X Extracts X X X X ..... radiators, etc., and is a registered dealer under the Act. The period involved is 1st January, 1970, to 31st December, 1970. The dealer-assessee purchased hydrochloric acid (tejab) worth Rs. 3,283.43 by giving a declaration that this acid is a raw material for manufacturing of radiators by it and, therefore, he is entitled to pay to the seller concessional rate of tax at the rate of 1 per cent as provided by section 5C(1) of the Act. The Commercial Taxes Officer (C.T.O.), Special Circle, Jodhpur, by his assessment order dated 6th December, 1972, for the period 1st January, 1970, to 31st December, 1970, was of the opinion that hydrochloric acid is not a raw material for the manufacture of radiators within the meaning of "raw material" as defined in section 2(mm) of the Act and, therefore, the dealer was not entitled to the concessional rate of tax at the rate of 1 per cent. The assessing authority, therefore, imposed penalty of Rs. 350 under section 5C(2) of the Act. The dealer-assessee filed an appeal against the order dated 6th December, 1972, imposing penalty of Rs. 350. The Deputy Commissioner (Appeals), Commercial Taxes, Jodhpur, by his order dated 17th July, 1975, disagreed w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act. We have heard Mr. K.C. Bhandari, the learned counsel for the C.T.O., and Mr. S.K. Kackar, for the dealer-assessee, treating this as an application for revision. In the first instance, Mr. K.C. Bhandari, learned counsel for the C.T.O., sought to raise a contention that hydrochloric acid consumed by the dealer-assessee is not raw material as defined in section 2(mm) of the Act. Mr. S.K. Kackar, learned counsel for the dealer-assessee, urged that the point whether hydrochloric acid is raw material for the manufacture of the radiators, cannot be reagitated by the assessing authority on the ground that in the case of this very assessee for an earlier year, the Board by its order dated 15th June, 1979. held that hydrochloric acid is raw material for the manufacture of the radiators and as such this operates as res judicata and the finding cannot be reagitated again. The objection raised by the learned counsel for the dealerassessee regarding res judicata has no substance. In this case, we are concerned with the period: 1st January, 1970, to 31st December, 1970. The order dated 15th June, 1979, was passed by the Board for earlier year holding that the hydrochloric acid is raw ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uent year or period. This conclusion of ours stands fortified by the aforesaid decisions. The objection raised on behalf of the dealer-assessee that the finding operates as res judicata is, therefore, overruled and now we proceed to determine the matter afresh. The only question that, therefore, now arises is whether in the facts and circumstances of the case, the imposition of penalty under section 5C(2) of the Act was justified or not. We may read the material part of section 5C of the Act: (1) Notwithstanding anything contained in this Act, but subject to such restrictions and conditions as may be prescribed, the rate of tax payable on the sale to or purchase by a registered dealer of any raw material for the manufac. ture in the State of goods other than exempted goods for sale by him within the State or in the course of inter-State trade or commerce or in the course of export outside the territory of India shall be at a concessional rate of 1 per cent of the sale or purchase price of such raw material. (2) Where any raw material purchased by a registered dealer under subsection (1) is utilised by him for any purpose other than a purpose specified therein, such dealer s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Division Bench, on behalf of the department, a contention was raised that hydrochloric acid is not raw material for the manufacture of the radiators in view of the definition of "raw material" contained in section 2(mm) of the Act, and that the department is not bound by the statement made in the registration certificate that hydrochloric acid is raw material. The Division Bench of the Board repelled the argument and relying on Bowen Press v. State of Maharashtra [1977] 39 STC 367 (Bom), observed as under: "In view of this, we are of the view that the entries in the registration certificate of a manufacturer about certain articles being raw materials for his manufacturing activities are conclusive and any modification thereof can only be made by the competent authority after following the prescribed procedure and it is not open to the taxing authorities to conclude that certain articles, though mentioned as raw materials for the manufacturing activities of the assessee in the registration certificate, are not raw materials." The sheet-anchor of the argument of the learned counsel for the C.T.O. is that the hydrochloric acid is not raw material for the manufacture of radiat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... conclusive and in face of the entry in the registration certificate, it is not open to the assessing authority to contend that though a particular article has been mentioned in the registration certificate as raw material, is not in fact a raw material within the meaning of section 2(mm) of the Act and if any cancellation or modification is sought in respect of that entry, then, it is only by following the procedure laid down under the Act and the Rules framed thereunder that entry can be cancelled or modified. It follows, therefore, that entry in the registration certificate shows that hydrochloric acid was purchased as raw material for the manufacture of the radiators by the dealer-assessee and until and unless it is cancelled or modified it is binding on the department and is conclusive proof of the fact that hydrochloric acid is raw material for manufacture of the radiators by the dealer-assessee. The further question that, now, engages our attention is whether in face of the entry, the imposition of penalty on the dealer-assessee is justified under section 5C(2) of the Act. A somewhat similar question arose in Rajasthan Spinning Weaving Mills Ltd. v. State of Rajasthan [19 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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