TMI Blog1991 (6) TMI 228X X X X Extracts X X X X X X X X Extracts X X X X ..... unregistered dealers and used the same in packing of its various finished products. Such goods were despatched for sale in the course of inter-State trade or commerce. It was contended before the Sales Tax Officer that the wooden boxes so purchased were resold for a price, over and above the sales of the manufactured goods packed therein. Such sales were in the course of inter-State trade and commerce. Therefore it was contended that since the goods were resold it was not liable to pay purchase tax under section 15 of the Act. The Sales Tax Officer rejected the contention on the ground that no express or implied sales of wooden boxes were proved. 3.. It may be noted that the dealer had also purchased "grasskhola" for Rs. 9,346 from unregistered dealers by making declaration in form 19 without payment of tax. Such "grasskhola" were also used to pack the finished products, in order to protect them from loss or damage during the transfer. The dealer tried to justify the purchase of grasskhola as consumable stores used in the manufacture of taxable goods. The dealer had contended that since grasskhola were resold it was not liable to pay the purchase tax under section 15 of the Act. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itted application for making reference to this Court, and requested to refer the following questions: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in holding that as the wooden boxes were used for the packing of manufactured goods, there could not be resale of such wooden boxes even though there was an express or implied agreement for the sale thereof?" However the Tribunal held that the question suggested by the dealer did not cover the finding given by the Tribunal and that it was required to be modified. Hence it modified the question. The Tribunal referred the following question to this Court: "Whether, on the facts and in the circumstances of the case, the Tribunal was right in law in holding that the wooden boxes once used as consumable stores in the manufacture of taxable goods for sale within the meaning of section 13(1)(B) of the Gujarat Sales Tax Act, 1969, cannot at the same time be paradoxically permitted to retain their original, independent or separate character in law, which would be apart from the manufactured goods, so as to make them legally capable of resale?" 7.. Learned Advocate-General appearing for the Revenue fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... container without any sale consideration therefor. The question in every case will be a question of fact as to what are the nature and ingredients of the sale. It is not right in law to pick on one ingredient only to the exclusion of the others and deduce from it the character of the transaction. For example, the circumstance that the price of the product and the price of the container are shown separately may be evidence that two separate transactions are envisaged, but that circumstance alone cannot be conclusive of the true character of the transaction." After the aforesaid observations, the Supreme Court held that in every case the assessing authority is obliged to ascertain the true nature and character of the transaction upon a consideration of all the facts and circumstances pertaining to the transaction. The Supreme Court further observed that the problem almost always requires factual investigation into the nature and ingredients of the transaction. In this connection the Supreme Court referred to the case law on the point and observed that the issue as to whether packing material has been sold or merely transferred without consideration depends on the contract between th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tribunal has recorded the concession made by the learned counsel for the dealer in the following words: "The appellant's learned advocate had unequivocally admitted or conceded before us that after purchases the wooden boxes in question from unregistered dealers, his client had used them in order to pack therein finished or manufactured goods like bottles of hair-oil and packets or card board boxes containing agarbatti, etc., in order to facilitate their transport to outstations for sale and to protect the finished or manufactured goods as packed in the disputed wooden boxes, against loss or damage in transit undertaken for the purpose of marketing the same for sale." The Tribunal relied upon the aforesaid admission. 11.. On the basis of the admission and in view of the evidence on record the Tribunal held that the principles laid down by this High Curt in the case of Vasuki Carborundum Works v. State of Gujarat reported in [1979] 43 STC 294 were applicable. In that case, the assessee was manufacturing crockery and carborundum and was selling the same as registered dealer. The assessee purchased "kathi" (twine) against declaration in form 19, to the effect that the goods we ..... X X X X Extracts X X X X X X X X Extracts X X X X
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