LexCOMMNR, SALES TAX, U.P. versus M/S BHARAT BONE MILL
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
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COMMNR, SALES TAX, U.P.
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v.
M/S BHARAT BONE MILL
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FEBRUARY 20, 2007
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[S.B. SINHA AND MARKANDEY KA TJU, JJ.]
U.P. Sales Tax Act, 1948-Crushed bone, if can be treated as Fertilizers
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for exemption from payment of sales tax-Held: There being no expert opinion
c before High ·court or Tribunal, as to whether crushed bones can be used only
for purpose of fertilizer or are sold to farmers for use thereof only as fertilizer-
Order of courts below set aside-Question of law left open.
The question which arose for consideration in this appeal was whether
a 'crushed bone' can be treated to be 'fertilizer'.
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Respondent is engaged in manufacture of crushed bone. By a
notification, State exempted 'Fertilizers' other than 'Chemical Fertilizers'
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from payment of sales tax. By another notification 'Chemical Fertilizers' were
also exempted. Thereafter, by yet another notification sale of 'bone to
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consumer' was exigible to sales tax at 6% and Chemical Fertilizer at 5%.
E Courts below relying on other decisions held that the crushed bone would
come within the purview of fertilizer. High Court dismissed the writ petition
filed by the appellants. Hence the present appeal.
Allowing the appeal, the Court
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HELD: 1. The question as to whether a commodity would be exigible to
sales tax or not must be considered having regard to its identity in common
law parlance. If, applying the said test, it is to be borne in mind that if one
commodity is not ordinarily known as another commodity; normally, the
provisions of taxing statute in respect offormer commodity which comes within
G the purview of the taxing statute would be allowed to operate. In any event,
such a question must be determined having regard to the expert opinion in
the field. The difference between 'bone meal' and 'crushed bone' is noticed.
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Different utilities of the said items has also been noticed by the High Court
itself. The High Court or for that matter, the Tribunal did not have the
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COMMNR, SALES TAX, U.P. v. BHARAT BONE MILL [S.B. SINHA, J.]
887
advantage of opinion of the expert to the effect as to whether crushed bones A
can be used only for the purpose of fertilizer or whether crushed bones are
sold to the farmers for use thereof only as fertilizer. The orders of the
Assessing Authorities including that of the High Court are set aside.
However, the question is left open for subsequent cases, if any.
(Paras 11 and 12] (890-E-H) B
Commissioner of Sales Tax, Madhya Pradesh v. Sagar Bone Mills, Sagar
: No. J (18 STC 338); CSTv. Crusher and Fertilizer Company, (1985) UPTC
905; The Rat/am Bone and Fertilizer Co. v. The State of Madhya Pradesh
and Anr., 35 STC 132; Yasin Bone Mills v. State of U.P. and inr., 46 STC
112: (1980) UPTC 450, referred to.
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2. The Assessing Authority proceeded to determine the taxability in view
of the decisions, as were prevailing. It sought to rectify its order keeping in
view the subsequent decisions. The question which arose for consideration
before the Tribunal was as to whether the Assessing Authority could pass
such an order having regard to the power of rectification in terms of Section D
22 of the Income Tax Act. (Para 13] (891-A-B)
The Income Tax Officer, Alwaye v. The Asok Textiles Ltd., Alwaye (1961)
3 SCR 236, referred to.
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 852 of2007.
From the final Judgment and Order dated 20.10.2003 of the High Court
of Judicature at Allahabad in S.T.R. No. 1570/1990.
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Kavin Gulati, Kamlendra Mishra, Gourabh Sarin and Rajeev Kumar Dubey F
for the Appellant.
The Judgment of the Court was delivered by
S.B. SINHA, J. 1. Leave granted.
2. Whether a 'crushed bone' can be treated to be 'fertilizer' is the G
question involved in this appeal arising out of a judgment and order dated
20.10.2003 passed by a learned Single Judge of the Allahabad High Court in
Sales Tax Revision No. 1570 of 1990 whereby and whereunder the revision
petition filed by the appellant herein was dismissed.
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SUPREME COURT REPORTS
[2007] 2 S.C.R.
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3. Respondent herein is engaged in manufacture of crushed bone. It
runs a bone mill for the above-mentioned purpose.
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4. The question as to whether crushed bone-meal would come within
the definition of the term "fertilizer" must be considered having regard to
some notifications issued by the State of Uttar Pradesh from time to time. By
B a notification dated 16Excerpt shown. Read the full judgment & AI analysis in Lexace.