- (1.) The appellant Company is engaged in the activity of running a plantation, growing rubber, tea and coffee. According to the appellant, the wood of the rubber trees is used only as a fuel or for packing cases, and not for the purpose of construction of building or for repair to any structure. That rubber plantation after certain period becomes old and uneconomical. For the purpose of replantation, such old rubber trees were sold as live standing rubber trees in accordance with the terms and conditions of the agreements entered into with the purchasers. Such standing rubber trees which were affixed to the ground were to be uprooted and removed by the purchasers only after a period of 24 to 60 months. Further, that the rubber trees could not be considered to be "timber" within the meaning of Explanation 1(ii) to Section 2(xxvii) of the Kerala General Sales Tax Act, 1963 (for short "the Act").
(2.) This matter had come up earlier before this Court in State of Kerala v. Tropical Plantation Ltd., 1999 3 SCC 720. The orders passed by the High Court as well as the Tribunal were set aside and the cases were remitted back to the Tribunal for a fresh decision on the point as to whether "rubber trees are timber for the purposes of levy of sales tax under the Act". The order of remand passed by this Court is reproduced below: (SCC p. 721, paras 1-4) "1. Earlier judgments of the Kerala High Court took the view that rubber trees were not timber [sic see (1989) 73 STC 336, 340 (para 5) were timber] and were, therefore, subject to the levy of sales tax under the Kerala General Sales Tax Act, 1963 . When the later of these two judgments was brought before this Court by way of a petition for special leave to appeal, this Court, while dismissing the petition, observed that it would be open to the petitioner in future years to place adequate materials to establish that rubber trees did not constitute timber . In the present matters the respondent-assessees placed such material before the Kerala Sales Tax Appellate Tribunal and relied upon the aforequoted observation. The Tribunal took the view that it was bound by the earlier judgments and, therefore, did not consider this material. The respondent - assessees moved the High Court in tax revision cases. The High Court considered the material and reached the conclusion that standing rubber trees were not timber and, therefore, not exigible to sales tax under the provisions of the said Act. 2. There can be no doubt that, in the circumstances, the Tribunal should have considered the materials that were placed before it and should have decided, as a matter of fact, whether rubber trees were timber. That error should have been cured by the High Court by remanding the matters to the Tribunal to consider the material and arrive at a finding thereon. It should not have considered that material itself; the final fact-finding body being the Tribunal, the finding as to whether rubber trees were timber should have been left to be decided by the Tribunal. 3. We think, in the circumstances, that it is appropriate to set aside the judgments and orders under appeal and remand the matters to the Tribunal. The Tribunal shall not consider itself bound by the earlier judgments of the Kerala High Court. It shall consider such materials/evidence as are placed before it by the assessees and by the Revenue and shall decide, based thereon, whether rubber trees are timber for the purposes of the levy of sales tax under the said Act. The Tribunal shall give to the parties the opportunity to produce additional materials/evidence. It shall decide the matters within six months from today. 4. The appeals are allowed accordingly. No order as to costs."
(3.) The Tribunal, instead of deciding the question on which the cases were remitted to it, went at tangent and proceeded to decide the appeals on a totally different point i.e. as to "whether the rubber wood would be timber or not". The basic question, as to whether the standing rubber trees would be timber or not, was not even touched upon.;