TMI Blog2010 (4) TMI 980X X X X Extracts X X X X X X X X Extracts X X X X ..... ade tax on the sale of poly pouches, the packing material which has been charged separately by the petitioner from the purchasers. W.P. dismissed. - Civil Misc. Writ Petition No. 317 of 2004 - - - Dated:- 27-4-2010 - PRAKASH KRISHNA AND BHARATI SAPRU , JJ. The petitioner, a unit of Co-operative Sugar Factory Federation, Lucknow is licensee for manufacture of liquor/country spirit at Majhola Distillery, District Pilibhit and is registered as a dealer under the U.P. Trade Tax Act, 1948. The provisions of the U.P. Excise Act and Rules are applicable on the manufacturing and selling of country liquor. The petitioner is a licensee under section 407 of the U.P. Excise Rules and is supplying/selling country liquor at the rate fixed and approved by the State Government from time to time. Country liquor is being sold in duly packed bottles or poly pouches. The assessments for the assessment years 1997-98 to 2000-01 under the U.P. Trade Tax Act as well under the Central Sales Tax Act, after scrutiny and verification of account books were completed by the assessing authority. The turnover of country liquor being an exempted item was exempted. No trade tax was levied on the pac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd as such the present writ petition is not maintainable. Heard learned counsel for the parties and perused the record. It is not in dispute that the petitioner has charged price on packing material separately, as admitted by Shri Bharat Ji Agrawal, the learned senior counsel for the petitioner. He submits that since no factual controversy is presently involved, the petitioner should not be relegated to file his objections before the authority concerned. In view of section 3AB and the fact that sale of country liquor is exempted from tax and the country liquor was sold in pouches, price of which was charged separately, the packing material will not be exigible to the trade tax, submits the learned senior counsel for the petitioner. In response Shri U.K. Pandey, learned standing counsel for the respondents, submits that on a correct reading of section 3AB, the petitioner has sold poly pouches (packing material) which is exigible to trade tax and therefore the impugned notices are valid. It is evident from the pleadings of the parties as well as of the stand taken by them that the petitioner has separately charged the packing material in the bills. The question of determi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le or purchase of such containers or packing materials shall also be exempt from tax. Interpreting the above provision along with the other provisions of that Act the apex court has held that the underlying idea behind these Rules is that the packed goods are to be taxed as composite units. In calculating the turnover of the goods, the turnover of containers will have to be included. The appropriate rate of tax will be the rate payable on the goods. The relevant portion from the judgement is reproduced below (at page 602 of 108 STC): 7. The underlying idea behind these rules is that packed goods are to be taxed as composite units. In calculating the turnover of the goods, the turnover of the containers will have to be included. The appropriate rate of tax will be the rate payable on the goods. It will not make any difference, if the containers are shown to have been sold and charged separately. The logical corollary to this principle is that when the goods are exempted from tax, no tax is leviable on the containers. This will be the position even when the goods and the containers are sold and charged separately. It has been further observed that the mere fact that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation. The New Lexicon Webster's Dictionary of the English Language Together (. . .) adv. in or into contact or union, the pages are stuck together . . . in or into the same place, group, etc., put them all together so that you can find them again, . . . at the same time, the two things happened together . . . with each other . . . in succession, it rained for days together . . . in a body, all the workers together . . . into agreement, try to bring the two firms together . . . by combined action, together they pushed the stalled car. Together with including with in addition, the house together with its grounds. The New Shorter Oxford English Dictionary the New Authority on the English Language Together A adv. 1 Into one gathering, company, or body; (of two persons, things, separate parts, etc.), into association, proximity, contact, or union. OE, 2 In company, as a body, (of two persons, things, separate parts, etc.), in union, conjunction, association, or contact. OE. b In notional combination ; collectively. LI8. 3 With coherence or combination of parts or elements belonging to a single body or thing; so as to form a connected, united, or coherent wh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d its earlier decision in Raj Sheel v. State of Andhra Pradesh [1989] 74 STC 379 (SC); AIR 1989 SC 1996. This was a case under the Andhra Pradesh General Sales Tax Act. Interpretation of section 6C which reads as follows was involved therein: 6C. Levy of tax on packing material. Notwithstanding anything in sections 5 and 6A, where the goods packed in any materials are sold or purchased, the materials in which the goods are so packed shall be deemed to have been sold or purchased along with the goods and the tax shall be leviable on such sale or purchase of the materials at the rate of tax, if any, as applicable to the sale or, as the case may be, purchase of goods themselves. In this case, the apex court has held that a transaction of sale may consists of (1) sale of the product and separate sale of the container housing the product with respective sale considerations for the product and the container separately; (2) or it may consists of sale of product and sale of container but both sales being conceived of as integrated component of a single sale transaction; or (3) it may consists of sale of product with transfer of container without any sale consideration therefrom. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Act are different. Now, coming to the facts of the present case we are of the opinion that section 3AB of the Act is nearer to section 6C of the Andhra Pradesh General Sales Tax Act as it talks about the deemed sale of packing material along with the goods contained therein as also that tax shall be leviable on such sale or purchase of the material at the rate of tax, if any, applicable to the sale, or, as the case may be, the purchase of the goods themselves. Section 5(5) and 5(6) of the Kerala General Sales Tax Act, 1963 are differently worded. Section 5(6) of the Kerala General Sales Tax Act, 1963 provides only this much that the packing material shall be charged to tax at the same rate at which its contents are charged, notwithstanding the fact that the packing material has been charged separately. Keeping in mind the distinction as pointed out by the apex court in the case of Premier Breweries [1998] 108 STC 598 (SC); [1998] 1 SCC 641 and Raj Sheel [1989] 74 STC 379 (SC); AIR 1989 SC 1996 as followed by the apex court in the case of Associated Cement [2006] 144 STC 342 (SC); JT 2006 (1) SC 107, it may be noticed immediately that in section 3AB of the Act there is no such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tely been charged therefor. Each case is required to be determined on the consideration of relevant materials placed on the record by the parties. In para 29 of the Report the following observations of the apex court with reference to section 3AB are relevant for the present purposes (at pages 190 and 191 of VST): 29. We, however, are not impressed with the arguments of Mr. Radhakrishnan that section 3AB of the Act introduced in the statute by reason of the U.P. Trade Tax (Amendment) Act, 1991 is clarificatory in nature. The said amendment came into force with effect from April 25, 1990. The assessment year, as noticed hereinbefore, is April 1, 1989 to March 31, 1990. The Act having been brought into force from a particular date, no retrospective operation thereof can be contemplated prior thereto. The said provision furthermore contains a substantive provision which is itself a pointer to the fact that for the earlier period packing materials would not be exempted merely because main commodity is exempted from tax, but albeit subject to the condition that there was an agreement to sell in respect thereof. The amendment sought to deal with a matter which created some problem in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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