TVL K.A.K. ANWAR AND CO. ETC. versus STATE OF TAMIL NADU

Citation: [1997] SUPP. 5 S.C.R. 551 · Decided: 27-11-1997 · Supreme Court of India · Bench: S.C. SEN · Disposal: Dismissed

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Judgment (excerpt)

TVL K.A.K. ANWAR AND CO. ETC. 
A 
v. 
STATE OF TAMIL NADU 
NOVEMBER 27, 1997. 
(S.C. SEN, B.N. KIRPAL AND K.T. THOMAS, JJ.] 
B 
Central Sales Tax Act 1956-Sections 14(iii), 15-Tamil Nadu General 
Sales Tax Act-Item 7 as substituted by (Third Amendment) Act, 1987-Hides 
and skins-Classification of-Held, dressed hides and skins and raw hides C 
and tanned skins are different commodities-Purchase of raw hides and skins 
on payment of tax-Liability to pay sales tax in respect of dressed hides and 
skins-Sec. 3 of Tamil Nadu General Sales Tax (Third Amendment) Act. 1987 
held not ultra virus-Inclusion of different articles under same heading or 
sub-item in Sec. 14 would not make two different goods to be regarded as 
one and the same item. 
D 
The appellants purchased raw hides and skins and after dressing they 
were sold in the course of inter-state trade. They alleged before the assessing 
authority that hides and skins, whether in a raw or dressed form, were 
declared goods u/s 14(iii) of the Central Sales Tax Act and they were 
· regarded by that Act as a single commodity and as the tax had been levied E 
at the time of purchase of raw hides and skins, there should be no levy of 
tax on their inter state sale after those raw hides and skins had been 
dressed. However, the authorities rejected their case by holding that raw 
hides and skins were a commodity which were different from dressed hides 
and skins and therefore the restrictions contemplated by Section IS of the F 
Central Sales Tax Act were not applicable. The appellants challenged the 
decision of the assessing authority by filing writ petitions. The High Court 
dismissing the writ petitions held that raw hides and skins was a commodity 
which was commercially different from dressed hides and skins both under 
the Tamil Nadu General Sales Tax Act well as the Central Act and that the 
State had the legislative competence to tax the inter state sale of dressed G 
hides and skins even though tax had been paid on the purchase of raw hides 
and skins and that the entries which had been substituted in the Second 
Schedule by the Amending Act of 1987 were constitutionally legal. Hence 
these appeals. The questions which arose for consideration was whether the 
turn over in respect of hides and skins which had once been subjected to tax H 
551 
552 
SUPREME COURT REPORTS [1997) SUPP. 5 S.C.R. 
A under the State Act on its purchase at the raw stage, could be taxed again 
on the inter state sales as tanned or dressed hides and skins. The controversy 
in these appeals related to three periods, namely, for the period prior to 23-
3-1987, for the period 23-3-1987 to 4-9-1991, when amendment was made 
to item 7 to the second Schedule to the State Act by Section 3 of the Tamil 
Nadu General Sales Tax (3rd Amendment) Act 1987, and for the period 
B subsequent to 4-9-1991, when that schedule was again amended, as a result 
of which the original entry got restored. 
The appellant submitted that raw hides and skins and dressed hides 
and skins irrespective of their state, are the same commodities, the difference 
C being only in form and therefore, hides had skins can be taxed at only one 
stage in the State and if they have been subjected to tax at the raw state under 
the local Act, then Section 15 of the Central Sales Tax would have the effect 
of preventing tax being levied on dressed hides and skins and further that 
Section 14(iii) of the Central Sales Tax Act regards hides and skins as a 
single commodity and they cannot be taxed twice over in any one State. 
D 
Dismissing the appeal, this Court 
HELD: I.I. Raw hides and skins and dressed hides and skins are not 
one and the same commodity. Tanning of raw hides and skins is a 
manufacturing process as a result of which the product that emerges is 
different from the raw material as after tanning the hides and skins become 
E a different commodity. (561-DJ 
Hajee Abdul Shakoor & Co. v. State of Madras, (1964) 8 SCR 217, 
foUowed. 
Govt. of Andhra Pradesh v. Nagendrappa, 7 STC 563 and State of 
F Andhra Pradesh v. M.A. Abdul Bari & Co., 9 STC 231, approved. 
Abdul Subban & Co. v. State of Madras, 11 STC 173, overruled. 
1.2. The fact that both the articles are mentioned under the same 
heading is of no material consequences. The inclusion of several articles 
under the same heading may be for a reason other than that the articles 
G constitute one and the same thing. Merely being put under one head would 
not make two di

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