Asstt. Commissioner Commercial Taxes Department vs Romesh Power Product Pvt. Ltd.

Alok Sharma, J.—The Rajasthan Tax Board, Ajmer (hereinafter ''the Board'') by its order dated 4-11-2003 concurred with Deputy Commissioner''s (Appeals) order dated 31-12-2002 that the Assessing Authority in its order dated 20-4-1999 has wrongly denied the respondent-assessee (hereinafter ''the assessee'') the benefit of notification dated 6-3-1991. The Commercial Tax Department (hereinafter ''the department'') is aggrieved. Hence this petition.

The facts of the case are that the assessee was at the time relevant to assessment year engaged in the business of manufacturing and selling of Electrical Wires, PVC Power Electrical Cables and Electrical Cables. Under the powers conferred by Section 4(2) of the Rajasthan Sales Tax Act, 1954 (hereinafter ''the 1954 Act'') the State Government with immediate effect beginning 6-3-1991 exempted from purchase by a registered dealer of any product of copper to the extent to which the rate of tax in respect thereof exceeded 1.5% in the event of three conditions detailed in the notification dated 6-3-1991 were satisfied. The three conditions were:-

"1. that such copper is used as raw material in the manufacture of any other products of copper within the State of Rajasthan.

that such manufactured products of copper is sold within the State or in the course of interstate trade or commerce; and

that such manufacturer shall issue a declaration to this effect in the form ST 17 appended to the RST Rules, 1955 to the selling dealer."

The respondent assessee a registered dealer under the 1954 Act purchased copper claiming exemption from tax over 1.5% ad valorem and admittedly utilised the same for manufacturing of PVC Power Electrical Cables and Electrical Cables. In a survey of the assessee''s business on 7-11-1997, finding that the assessee was manufacturing and selling PVC Power Electrical Cables and Electrical Cables, the Assistant Commercial Taxation Officer was of the view that the assessee was not fulfilling the condition of the notification dated 6-3-1991, which provided that copper purchased on a concessional rate be used as a raw material in the manufacture of any other product of copper within the State of Rajasthan. Show cause notice ensued. Reply of denial was filed by the assessee. The Assessing Officer however denied the benefits of the notification dated 6-3-1991 to the assessee to the extent it utilised purchase of copper at a concessional rate for the manufacture of PVC Power Electrical Cables and Electrical Cables and vide order dated 20-4-1999 visited the assessee with additional tax of 1.5% (over the tax already paid) being the differential tax as purchase of copper at the relevant time was otherwise chargeable to tax at the rate of 3%. Interest on tax short paid was also levied.

Aggrieved, the assessee filed an appeal against the order of re-assessment dated 20-4-1999 for purported escapement of tax before the Deputy Commissioner (Appeals). Vide order dated 31-12-2002 the Appellate Authority held that Electrical Cables and PVC Power Electrical Cables had 85% composition of copper consequent to which they were evidently products of copper and the condition of the notification dated 6-3-1991 mandating the use of copper as raw material purchased at a concessional rate in the manufacture of products of copper in State of Rajasthan was satisfied. The order dated 20-4-1999 passed by the Assessing Officer was set aside. This time around the department was aggrieved and it filed a second appeal to the Tax Board. Vide order dated 4-11-2003, the Tax Board dismissed the department''s appeal relying upon its own prior judgment in the case of M/s. Jai Ambe Copper Industries Vs. Asstt. Commissioner [(2002)3 Tax Update 195]. The Tax Board held that it had already decided that as the dominant component of Electrical Wires, PVC Power Electrical Cables and Electrical Cables was copper to an extent of 85%, they were within the meaning of the words "products of copper" satisfying the condition of the notification dated 6-3-1991. The assessee was hence exonerated of the additional tax and interest thereon visited upon it by the Assessing Authority.

Heard the officer in-charge and perused the impugned order dated 4-11-2003 passed by the Tax Board. Considered.

I do not find any force in the submission of the officer-in-charge in challenging the order dated 4-11-2003 passed by the Tax Board. The Tax Board has rightly held that goods of which the dominant and essential component was copper were "products of copper". Hence the manufacture of Electrical Wires, PVC Power Electrical Cables and Electrical Cables with 85% component of copper satisfied the condition of the notification dated 6-3-1991 that the copper purchased at a concessional rate was to be utilised for the manufacture of copper products. There is no illegality or perversity in the impugned order dated 4-11-2003 passed by the tax Board. Further the OIC has not been able to establish that the view of the Tax Board on the question in issue as enumerated in the case of M/s. Jai Ambe Copper Industries (supra) was challenged or set aside.

There is no force in the revision petition. Accordingly, it is dismissed.