M. Satyanarayana Murthy, J. - (1.) ALL these revisions filed by revenue against the impugned common order dated 15 -09 -2011 in T.A. Nos. 637, 638, 639, 640 of 2002 and 45 of 2003 passed by Sales Tax Appellate Tribunal, Andhra Pradesh, Visakhapatnam Bench (for short, 'the tribunal'). The respondent is a registered dealer on the rolls of ACTO, Macherla Circle, Guntur - II Division, manufacturer of cement and reported turnover of the business to ACTO. The ACTO, Macherla Circle, levied penalty on the ground that diesel purchased against C forms was misused. Aggrieved by the order of the ACTO, the respondent -assessee herein filed appeal before Appellate Deputy Commissioner (CT), Guntur, and the same was dismissed. Aggrieved by the orders of the ADC (CT), Guntur, the appellant preferred appeal before the tribunal, whereunder the contention of the respondent was upheld and allowed the appeal holding that diesel was not misused and it was used only for manufacturing purpose. The assessee engaged in manufacture and sale of cement and purchased diesel to utilize for captive power generation in manufacturing of cement. The assessee used diesel for transportation in vehicles such as tippers for transportation of limestone to factory from mines for manufacturing cement. Diesel was also being used for maintenance of lift which was used by technical persons for checking kiln as and when required. Factory vehicles also used diesel oil for transportation of raw material like coal, laterite from stockyards to manufacturing place. Vehicles like jeeps and other vehicles utilized diesel for taking and bringing back the staff working in mines. Thus, the assessee utilized diesel oil for the above purposes which is a manufacturing activity but having found, the revenue imposed penalty exercising power under Section 10 of Central Sales Tax Act, 1956 (for brevity, 'the Act of 1956'), on the ground of misuse of purchased diesel against 'C' forms. It was the contention before the tribunal that transportation of workers from mines etc., is a manufacturing process and that on interpretation of the word manufacture is to mean conversion of raw material into finished goods whatever required during that process, they could be purchased against C forms. However, the CTO did not accept the contention and concluded that diesel purchased against C forms could be used for generating electricity and other manufacturing process but not for other purposes and the same was challenged before the tribunal. It is further contended that the CTO erroneously referred G.O.Ms. No. 625 Revenue dated 31 -07 -1996, which was issued for concessional rate of tax on diesel, and that the assessee has no mens rea in purchasing diesel against C forms and utilizing the same in the course of manufacturing of cement. Thereby, the order of CTO is illegal and prayed to set aside the order.
(2.) THE tribunal, upon appreciation of law laid down by Apex Court in several decisions, held that the petitioner is entitled to utilize diesel though purchased against C forms since transportation of workers from mines to factory etc., is a part of manufacturing process and set aside the order passed by CTO. Aggrieved by the impugned common order, the revenue preferred the present revisions on various grounds mainly contending that the principles laid down in J.K. Cotton Spinning & Weaving Mills Company Limited vs. The Sales Tax Officer, Kanpur, and Another : 16 STC 563 SC; Indian Copper Corporation Limited vs. Commissioner of Commercial Taxes, Bihar, and another : 16 STC 259 SC and Chowgule & Company Private Limited and Another vs. Union of India and others have no application. Apart from that, the goods should be purchased by the assessee for being intended for use as machinery, plant, equipment, tools, spare parts, stones, accessories, fuel or lubricants since those parts alone closely connected with the main activity of manufacturing of cement but using diesel, purchased against C forms, for jeeps and other vehicles for taking and bringing back staff working in the mines is against the principles laid down in Coastal Andhra Power Limited, Nellore vs. State of Andhra Pradesh 52 APSTJ 23 (AP) and that the principle laid down J.K. Cotton Spinning & Weaving Mills Company Limited (supra) was distinguished by the Supreme Court in later judgment.
(3.) LEARNED Special Standing Counsel for Commercial Taxes mainly contended that the principle laid down in J.K. Cotton Spinning & Weaving Mills Company Limited (supra) has no application to the present facts of the case. Even the principle laid down in Indian Copper Corporation Limited (supra) is not applicable to the present facts of the case and he placed reliance on the judgment rendered in Indra Singh & Sons Private Limited vs. Sales Tax Officer, Raigarh Circle, Raigarh and Others 17 STC 1966 SC 510.;