Decided on May 11,1984



S. K. Mal Lodha, J. - (1.)- The Board of Revenue for Rajasthan, Ajmer (The Board, herein) has referred the following question of law for our deci-sion:- "whether on the facts and circumstances of this case the galvanised currugated sheets come within the definition of iron and steel for the relevant assessment period ?"
(2.)THE dealer-assessee (respondent) was assessed by the C. T. O. Pali (Assessing Authority) in resect of the year 1964-65 u/s 10 of the Rajasthan Sales Tax Act (No. XXIX of 1954) (for short 'the Act' herein) and held that the sale of galvanised corrugated sheets were liable to tax at general rate for the relevant assessent period. THE dealer-assessee was unsuccessful in appeal. A revision was filed before the Board. THE Board by its order dated September 18, 1974 held that the sale of galvanised corrugated sheets are taxable @ 2% and not @ 6% as decided by the Assessing Authority and the Deputy Commissioner, (Appeals) Commercial Taxes, Jodhpur, in appeal. It was further held that the excess tax of 4% charged, if collected, be refunded to the dealer. THE Board while doing so relied on M/s. Radha Ballabh & Sons vs. State of Rajasthan (1) which is a decision rendered by the three learned Members of they Board. According to the Board the galvanised corrugated sheets fall within the definition of Iron and Steel within the meaning of Sec. 14 of the Central Sales Tax Act (No. 74 of 19. 6) hereinafter to be referred as 'the C. S. T. Act' ). An application for reference under section 15 (1) of the Act was filed by the Assessing Authority. THE Board thought it proper to make a reference to this Court for deciding the question aforesaid. 2. We have heard Mr. A. K. Mathur, learned counsel for the Assessing Authority. No body has appeared on behalf of the dealer-assessee.
The only question which we are called upon to decide is whether in the case on hand the galvanised corrugated sheets come within the definition of "iron and Steel" in respect of the relevant assessment period.

The relevant portion of Sec. 14 of the C. S. T. Act as it stood at the relevant time reads as under:- "it is hereby declared that the following goods are of special importance in inter-State trade or commerce:- (i) coal, including coke in all its form; (ii) cotton, that is to say, all kinds of cotton (indigeneous or imported) in its unmanufactured state, whether ginned or unginned, baled, pressed or otherwise, but not including cotton waste; (iii) hides and skins, whether in a raw or dressed state; (iv) iron and steel, that is to say:- (a) pig iron and iron scrap; (b) iron plates sold in the same form in which they are directly produced by the rolling mill; (c) steel scrap, steel ingots, steel billets, steel bars and rods; (d) (i) steel plates, (ii) steel sheets, sold in the same form in which (iii) sheet bars and tin bars, they are directly (iv) rolled steel sections produced by the (v) tool alloysteel; rolling mill;

A Division Bench of the Board in the case of M/s. Raj. Iron & Steel Merchants Assn. , Pvt. Ltd. Jaipur vs. State (2) observed as follows:- "we find that all these items of CP & GC sheets and CI wires have one thing in censur is that they are all galvanised i. e. they are galvanised plain sheets and galvanised corrugated sheets, and galvanised I. wires. As corrugation is only a change in the shape of sheet, it does not really change the property of the matter and as the main point at issue remains, whether galvanisation does make any fundamental difference in the nature of the item. In the Chamber's Twentieth Century Dictionary, galvanised iron is defined as 'iron coated with zinc'. It would, thus be seen that galvanisation is the process by which sheets or wires of iron get a continuing of zinc. In our opinion, such a process where the entire metal area of the iron item is coated with another metal (zinc) in the present case there occurs a basic change in the nature and properties of the iron sheets or wires, and accordingly after this process of galvanisation, they could not be strictly called merely items of 'iron & Steel'. I view of this position, we find that it has been rightly held that galvanised plain sheets or galvanised corrugated sheets or galvanised I, wires, no longer fall under the category of Iron & Steel' u/s. 14 of the Central Sales Tax Act and as notified vide Government Notification dated 2. 3. 63. Thus, they attract sales tax at the rate of 6% instead of 2%".

The Board held that CP and GC sheets and CI wires are liable to sales tax at the rate of 6%. In that case the assessment year was 1963-64 and the accounting period was from 1. 4. 63 to 31. 3. 64. In M/s Radha Ballabh & Son's case (supra) the Larger Bench of the Board did not subscribe to the view taken in the Rajasthan Iron & Steel Merchant's case (supra ). As there was no decision of the reference made to this Court, the Board referred the matter to a Larger Bench. The question in M/s Radha Ballabh & Son's case (supra) was whether galvanised corrugated sheets fall within the term "iron and steel" occurring in Sec 14 (iv) of the C. S. T. Act as it then stood and it opined that galvanised corrugated sheets fall under the definition of 'iron and steel' within the meaning of Sec 14 (iv) of the C. S. T Act and galvanisation or corrugation does not effect their basic charactor as iron and steel. As a necessary consequence of that the Larger Bench in M/s. Radha Ballabh and Son's case (supra) was of the view that the later view of the two Division Benche's of the Board opining that by process of galvanising the iron sheets do not lose their basic character and they stitl fall within the term 'iron and steel' under s. 14 (iv) of the C. S. T. Act is the sund view and it dissented with the view taken in M/s. Raj Iron a Steel Merchant's case (supra ). Here we may mention that in coming to the aforesaid conclusion, the Board, inter-alia, noticed the cases of State of Gujarat vs. Shah Valjibhai (3), Algu Ram Harinarayan Ram vs. A. C. S. T. Cuttak (4), Hukamchand Mahendra Kumar vs. Commissioner of Sales Tax (5), C. G. T. U. P. Vs. Agrawal Commercial Corp. (6) and State of A. P. Vs. Sri Durga Hardware Stores (7 ).

(3.)IT relied on State of A. P. 's case (supra) in which it was held : "that galvanised plain or corrugated sheets and B. P. sheets fall within the ambit of "iron and Steel" in entry 2 of the Third Schedule to the Andhra Pradesh Central Sales Tax Act. "
The entry No. 2 in that Act was in parimoteria with Sec. 14 (iv) of the C. S. T. Act as it stood before the amendment.

The Larger Bench of the Board agreed with the view taken in the case of State of A. P. 's case (supra ).

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