LexSTATE OF PUNJAB versus HINDSONS (P) LTD.
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STATE OF PUNJAB
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HINDSONS (PJ LTD.
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September 20, 1984
[D.A. DESAI AND D.P. MADON, JJ.]
Words and Phrases- 'Belt Pulley Attachment'-Whether an agricultural
implement-Whether /ia'.l/e to be exempted from the levy of sales tax-Entry 34,
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of Schedule 'B'-Punjab General Sales Tax Act, 1948.
"The respondent-assessee, a dealer in tractors, motor-cycles and spare-
parts etc., while filing its quarterly returns, claimed deduction in respect of
tax free goods of Rs. 26, 511. 82 being th; sale pro;::eeds of belt pulley attach-
ment sold along with the tractor or separ<Jtely by itself from its yearly gross
turn over of Rs.
21,65,983.91 for the assessment year 1965-66 on the
'""" ground that the belt pulley attachment should be treated as an agricultural
implement and therefore it is en:empted from the levy of sales tax under
Entry 34 of Schedule B to the Punjab General Sales Tax Act (the Act for
short).
Th~ assessing authority rejected the claim on the ground that the
belt pulley attachment could not be treated as a composite part of the tractor
nor can it be treated as an agricultural implement and it was not one of the
tax free goods as contemplated by Entry 34. The respondent-assessee
preferred an appeal to the appellate authority against the order of the
assessing authority. The appellate authority allowed the appeal holding that
the sales of belt pulley attachment amounting to Rs. 26, 572. 82 p. was of
tax free goods under Sec. S (2) (al (i) of the Act and that amount should be
deducted from the gross turnover of the assessee. But, the Joint Excise and
Taxation Commissioner suo moto quashed the order of the appellate authority
and res 1ored that of the assessing authority. In revision,
Sales Tax
Tribunal confirmed the decision of the Taxation Commissioner. Thereupon
the respondent-assessee moved the High Court which held that the belt
pulley attachment falls within the meaning of the expression agricultural
implement since it increases the utility of a tractor for an agricultural oper-
tion. Hence this appeal by special leave.
Allowina the appeal,
HELD : (!) Belt pulle1 means a pulley over which a belt may pass to
transmit power to other part of the machine. It is indeed true that the beJt
pulley when used in a tractor may increase the utility_ of the tractor for agri~
cultural operations but that by itself does not lead to the inevitable conclu-
sion that belt-pu1ley attachment is an agricultural implement. It is not only
used in a tractor but it is also used in various other machines such as motor
car engines, water pumps. threshers etc. Therefore, when sold as a spare
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SUPREME COURt REPORTS
(1985] l s.C.R,
part it cannot by itself become an agricultural implement. To comprehend
it in the generic term "agricultural implement," the court would have to
•stretch the language to impermissible limit of breaking it.
[773 H, 774 A-G]
In the instant case, the assessee is selling belt pulley attachment as
spare part which can be used in many machines.
Therefore, the belt pulley
attachment which can be used in various mechanical appliances or devices by
itself cannot be said to be an agricultural implement.
C1v1L APPELLATE Ju&1s01cnoN: Civil Appeal Nos. 1817-19
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of 1984
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Appeal by Special leave from the judgment and Order dated
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the 6th November, 1981 of the Punjab and Haryana High Court in
Sales Tax Ref. Nos. 4-5 of 1978 and C.W.P. No. 3095 of 1973.
S.K. Bagga for the Appellant.
Vineet Kumar for the Respondent.
The Judgment of the Court was delivered by
DESAI, J. On a direction given by the High Court of Punjab
and Haryana at Chandigarh, the Sales Tax Tribunal, Punjab,
Chandigarh ('Tribunal' for short) referred under Section 22(2)(b) of
the Punjab General Sales Tax Act, 1948 ('Act' for short) the
following question of law to the High Court for its opinion :
"Whether a belt pulley attachment was an agricultural im-
plement within the meaning of entry 34 of Schedule 'B' of
Punjab General Sales Tax Act, prior to the amendment
made on April 15, 1971"?
This question came to be referred to the High Court at the
jnstance of the assessee, the respondent herein. The respondent
firm deals in tractors, motor-cycles, cycles, spare-parts etc. The
assessee filed its quarterly returns declaring a gross yearly turnover
of Rs. 21,65,983.9 l p. Deductions were claimed in respect of sales of
tax-free goods, sales madExcerpt shown. Read the full judgment & AI analysis in Lexace.