DELHI CLOTH & GENERAL MILLS CO. LTD. & ORS. versus R.R. GUPTA, COMMERCIAL TAX OFFICER, JAIPUR & ANR.

Citation: [1976] SUPP. 1 S.C.R. 497 · Decided: 03-05-1976 · Supreme Court of India · Bench: A.N. RAY

Judgment (excerpt)

• > 
' . . 
' 
, 
497 
DELHI CLOTH & GENERAL MILLS CO. LTD. & ORS. 
A 
v . 
R.R. GUPTA, COMMERCIAL TAX OFFICER, JAIPUR & ANR. 
May 3, 1976 
(A. N. RAY, C.J., M. H. BEG AND JASWANT SINGH, JJ.] 
Raiastlwn Sales Tax Act, 1954-Statutory re1nedies provided under the Act 
not exhausted-No error apparent on the face of the record-If petition under 
Art. 226 lay . 
Co11.stitution of India, 1950-Art. 32-Absence of jurisdiction to assess not 
shown-If remedy lies under Art. 32. 
B 
c 
Rayon tyre cord fabric which is a textile consisting of rayon threads in the 
warp and cotton threads in the weft is manufactured on weaving looms in the 
same manner as any other ordinary textil~. The tyre manufactureni, to whom 
the product is supplied, impregnate the fabric with rubber and weave it into 
fabric. Under Entry 18 of Schedule of the Rajasthan Sales Tax Act, 1954, 
rayon fabric& were exempt from sales tax. 
When the Commercial Tax Ollkcr 
rejected the petitioners' objections to sales tax being leviro on rayon tyre cerd 
fabric, the petitioners filed a petition under Article 32 of the Constitution alleging 
D 
breach Of Fundamental Rights. 
Tn respect of certain earlier assessment years, however, the view of the 
Commercial Tax Officer was that the gocxls were not the end prOOuct; when, the 
matter was taken to the High Court, it held that, until the statntory remedies 
had been exhausted, no case for interference under Art. 226 arose. It did 
not find any error apparent on the face of the record. Hence, the appeals by 
!YlJCCial leave-. 
E 
In the writ petition as well as in the appeals it was contended that the 
goods constituted the end-Product which the petitioners sell in the market and, 
therefore, were exempt; fr<>m sales tax. 
Di1missing the 
pe.ti~tion and appeals, 
HELD : (I ){a) It is difficult to find fault with the view of the High, 
Court that there was no error apparent on the face of the record and that the 
taxing authorities should be left lo determine whether the tyre cord fabric 
is more correctly capable of being described as a fabric or as merely cord 
passing of as a textile fabric. This is really a technical question. 
In any case, 
it is: a question on which two vie~ may be. possible. 
[503C] 
F 
(b) The fact that the tyre co.rd fabric manufactured by the petitioners i9 
G 
\VOVOll by its purchases into a fabric in the same way as is being done by the 
petitioners means that the tyre cord fabric serves also as raw material fOr another 
fabric which ultimately emerges by .subjecting the goods to a process of impreg~ 
nating it whh rubber. The essential question to determine is the stage at which 
the J¥)Ods under consideration beco1ne textile fabrics if they do become that at 
all. [S02C; 503Al 
(2) This Court cannot interfere under Art. 32 with the decisioh of the 
H 
Commercial Tax Officer, because no Fundamental Right is -shown to be affected 
by a mere determination of the question. 
There was no absence of jurisdiction 
of !be taxing authorities who had th! power to decide the question either rightly 
, or wrongly, [S03El 
, 
34-833 Sup Cl/76 
A 
B 
c 
D 
E 
SUPREME COURT REPORTS [1976] SUPPLEMENTARY 
ARGUMENTS 
For the vetitioners 
Respondent No. 1 did not produce or get any evidence fro111 the commercj<tl 
community deali.tig with rayon tyre yarn and cord and rayon tyre fabnc for 
the purpose of conuoverting the conclusive evidenc..-e produced by the pc•1uo~r" 
to the elfect that in the commercial community dea1ing with the said goods the.be 
goods were different both fr6m the, point of view of' manufacture and abo 
from the point of view of ultimate end·product and are considered to 
b~ 
different by the commercial community, \Vhich treats rayon tyre cord fabric as 
fabric. 
There was no evidence on the contrary to coine to the conclusion that 
the rayon tyre fabric was not fabric. The High Court wrongly relied on 25 
STC 407 which had no application in the present case, ignoring the decision :r1 
22 SIC 470 and zg STC 431. It was therefore not a case of disputed question 
of fact, but a case of admitted fact by the commercial community against which 
there was no evidence before the respondent. 
The respondent committed an error apparent on the face of the record aIJLl 
proceeded on irrelevant and extraneous considerations. 
In any event the tyre 
cord fabric is sold by the petitioners as an end-product to cus1omers. To what 
use the customers put such commodity is no concern of the appellan'. 
Su~h 

Excerpt shown. Read the full judgment & AI analysis in Lexace.