LexMALAYALA MANORAMA CO. LTD. versus ASSTT. COMMISSIONER, COMMERCIAL TAXES & ANR.
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[2010) 7 S.C.R. 993 MALAYALA MANORAMA CO. LTD. v. ASSTT. COMMISSIONER, COMMERCIAL TAXES & ANR. (Civil Appeal No. 2267 of 2007) JULY 08, 2010 [DR. B.S. CHAUHAN AND SWATANTER KUMAR, JJ.] Kera/a General Sales Tax Act, 1963: A B s.5(3) - Printing of newspaper - Ink purchased for use c in the manufacture/printing of newspapers - Declaration furnished by assessee under Form 18 - Authorities issued notice imposing penalty on the ground that printing newspaper did not amount to manufacture and therefore declaration under Form 18 was not correct - Plea of assessee 0 that s.5(3) was amended on 1.4.2000 and the amended section did not contemplate any manufacturing activity - Held: Material amendment were carried out in s.5(3)- Despite the amendments, the format of Form 18 was not amended - High court did not deal with these legal issues - Matter E remitted to High Court for consideration afresh. Assessee purchased printing ink for use in printing newspapers during the year 2001-02. The purchase was effected by issuing Form 18 under the Kerala General Sales Tax Act, 1963. In terms of Section 5(3) of the Act, F assessee was liable to pay only concessional rate for that period. The Assistant Commissioner issued a notice for imposition of penalty on the ground that the process of G printing of newspapers did not involve manufacturing process and thus the declarations furnished by the assessee under Form 18 were not correct. It was specifically pleaded by the assessee that the provisions 993 .H 994 SUPREME COURT REPORTS [2010) 7 S.C.R. A of Section 5(3) of the Act were amended by the Finance Act, 2000 with effect from 01.04.2000 deleting the provision that manufactured items shall be taxable and, therefore, the issuance of notice was not proper. It was also stated that the amended section did not contemplate B any 'manufacturing' activity and the word used was 'production'. The Assistant Commissioner held that the concession was applicable only to 'goods' and C newspaper was not 'goods' within the meaning of Section 2 of the Act. Assessee filed writ petition which was dismissed. In appeal to this Court, appellant-assessee contended that the initiation of the proceedings was D based on a provision which had been repealed, non- existent and inapplicable, as such, the entire proceedings and imposition of penalty was unjustified, however, this issue was not dealt with by the High Court. It was further argued that even the alternative submission as to E whether the newspaper was covered within the definition of 'goods' and as to what was the effect of the amendment of the provisions of Section 5(3) and particularly, the substitution of the word 'manufacture' by the word 'production' was not correctly examined. The F conclusion of the High Court on the matter in issue was primarily with reference to the un-amended provisions and on an erroneous impression of law that despite amendment, the 'goods' would still not include 'newspapers'. G Disposing of the appeal and remitting the matter to High Court, the Court HELD: There is no dispute to the fact that the material amendments were carried out in the provisions H of Section 5(3) of the Kerala General Sales Tax Act with MALAYALA MANORAMA co. LTD. V. Assn. COMMNR., I ~95 · COMMERCIAL TAXES . effect from 01.04.2002. The existing 1st proviso to Section A 5(3)(i) was deleted as well as the expression 'or ,uses' th~ same rn the manufacture of any goods which are not liable to tax in this Act' in Section 5(3)(i) was also deleted. Despite these amendments, as it appears from the record before the Court, format of Form No. 18 was not B amended consequently. However, the High Court did not dwelve updn those legal issues which were the core issues involved in the case. [Para 9] [999-D-FJ Aspinwall & Co. Ltd. v. Commissioner of Income Tax, Ernakulam (2001) 7 SCC 525; Collector of Central Excise v. C I Bal/arpur Industries Ltd. (1989) 4 SCC 566; Printers (Mysore) Ltd. v. Assistant Commercial Tax Officer (1994) 93 Sales Tax Cases; Whirlpool Corporation v. Registrar of Trade Marks (1998) 8 SCC 1; State of H.P. & Ors. v. Gujarat Ambuja -· Cements Ltd. (2005) 6 SCC 499 - referred to. D Case Law Reference: (2001) 1 sec 525 referred to Para 6 (198~) 4 sec 566 referred to Para 6 ' i 19~-4) ~31Sales Tax cases 95 referred to Para 6 . I (1998) a sec 1 referred to Para 6 (2005) s sec 499 referred to
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