TMI Blog1991 (7) TMI 343X X X X Extracts X X X X X X X X Extracts X X X X ..... However, the assessing authority relied on the circular issued by the erstwhile Board of Revenue in BPRT. 13/79 stating that transformer oil is not a component part of transformer and the concessional rate under section 3(3) of the Act cannot be made applicable. Accordingly, the said turnover was taxed at 8 per cent. 2.. On appeal, the Appellate Assistant Commissioner held that transformer oil is only used in the process of cleaning or cooling and is not therefore a component part of the transformer. He also relied on the abovesaid circular and rejected the claim of the assessee. On second appeal, the Tribunal relying on a decision reported in Premier Electro-Mechanical Fabricators v. State of Madras [1968] 22 STC 269 (Mad.), held as follows: "Respectfully following the decision of our High Court we hold that once valid form XVII declarations have been filed, the question whether the transformer oil is a component part or not, as certified by the buyer, is beyond the jurisdiction of the assessing officer. It is not in dispute that the declarations have been otherwise properly filed. We, therefore, hold that the turnover of Rs. 7,43,883.79 is taxable at the lower concessional ra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uced as follows: "3. Amendment of section 3, Tamil Nadu Act 1 of 1959.-In section 3 of the principal Act (i) in sub-section (3) for the words 'three per cent' the words 'four per cent' shall be substituted; (ii) after sub-section (3), the following sub-sections shall be added, namely- (4) Notwithstanding anything contained in sub-section (1), (2) or (3), the tax payable by a dealer in respect of any sale of goods- (i) mentioned in the First Schedule, and (ii) specified in a scheme published by the Government, by notification by such dealer to another for use by the latter as raw material of any other goods mentioned in that Schedule and specified in the said scheme, which he intends to manufacture inside the State for sale shall be at the rate of four per cent on the turnover relating to such sale: Provided that the provisions of this sub-section shall not apply to any sale unless the dealer selling the goods furnishes to the assessing authority in the prescribed manner within the prescribed period a declaration duly filled in and signed by the dealer to whom the goods are sold containing the prescribed particulars in a prescribed form obtained from the prescribe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... old containing the prescribed particulars in a prescribed form obtained from the prescribed authority: Provided further that any dealer who, after purchasing the goods in respect of which he had furnished any declaration, fails to make use of the goods so purchased for the purpose specified in the declaration but disposes of such goods in any other manner, shall pay the difference of tax payable on the turnover relating to sale of such goods at the rate prescribed and four per cent: Provided also that the dealer purchasing the goods maintains a separate stock account for each of the goods purchased by him showing such particulars as may be prescribed. Explanation.-For the purposes of this sub-section 'consumables' means fuels, welding electrodes, welding rods, abrasives, carbide tip tools and lubricating oils. (4) Where any dealer, after availing the concessional rate of tax under sub-section (3) does not sell the finished goods but despatches them to a place outside the State either by branch transfer or by transfer to an agent, by whatever name called, for sale, or in any other manner, except as a direct result of sale or purchase in the course of inter-State trade or c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es the requisite, if he complies with the proviso, and he is not called upon, beyond production of a declaration in form XVII, to show that the declaration has been given effect to. It is true that, in order to satisfy the third requisite, the goods sold should be for use by a purchasing dealer as component parts of some other goods to be manufactured. But the manner in which the seller has to satisfy the requisite is as provided in the proviso to the sub-section, namely, production of the declaration in the prescribed form. Once that is done, there is no further obligation on the part of the selling dealer and he will automatically be entitled to the concessional rate. If the declaration turns out to be false, in the sense that the goods purchased have not been used as declared in the prescribed form, the purchaser is exposed to the penalties provided by section 23 and section 45(2)(e)." 8. Mr. Natarajan, seeks to draw further support for the same proposition from the decision reported in State of Madras v. Radio and Electricals Ltd. [1966] 18 STC 222 (SC). In that judgment the following observations in Civil Appeal 335 of 1965 are quoted: "We are of the opinion that whether ..... X X X X Extracts X X X X X X X X Extracts X X X X
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