S.B.SINHA, J. - (1.) LEAVE granted.
(2.) 'Horn' and 'hoof in common parlance do not come within the definition of 'bone'. Horns and hooves whether can be used as fertilizer or crushed bone within the meaning of various notifications issued by the State of U.P. under the U.P. Trade Tax Act is the question involved in this case. Appellants herein are dealers in crushed bones as also crushed horn and hoof. It is registered under the Central Sales Tax Act as also the U.R Trade Tax Act. Horn and hoof, on the one hand, and bone or crushed bones, on the other, used to be treated differently by the State. In a notification issued by the State on or about 7/9/1981, 'bones' were subjected to sales tax at the rate of 6%; the taxing event being sale to the consumer. By a notification dated 30/9/1982, it was declared that no tax was to be paid on sale or purchase of bones but the same did not include crushed bones. The said notification dated 7/9/1981 was amended to include 'crushed bone' against entry No. 8 which, as noticed hereinbefore, mentioned 'bone'. By a notification dated 31/1/1985, however, bone including horn and hoof but not including crushed bones were exempted from payment of tax. We may, however, notice that yet again by a notification dated 12/9/1986, the following item was substituted in place of the original item No. 32 which reads as under : JUDGEMENT_579_SUPREME5_2007Html1.htm
(3.) INDISPUTABLY, fertilizer is exempted from payment of trade tax. The question as to whether crushed bones when sold to the farmers for use as fertilizer despite the aforementioned notifications would be exigible to trade tax or not came up for consideration before this Court in Commissioner, Sales Tax v M/s. Bharat Bone Mill, [(2007) 3 SCALE 383]. Therein the effect of the aforementioned exemption notifications had not been gone into as this Court's attention had not been drawn thereto. This Court opined: "11. Moreover, it is well-known that the question as to whether a commodity would be exigible to sales tax or not must be considered having regard to its identity in common law parlance. If, applying the said test, it is to be borne in mind that if one commodity is not ordinarily known as another commodity; normally, the provisions of taxing statute in respect of former commodity which comes within the purview of the taxing statute would be allowed to operate. In any event, such a question must be determined having regard to the expert opinion in the field. We have noticed hereinabove the different between 'bone meal' and 'crushed bone'. Different utilities of the said items has also been noticed by the Allahabad High Court itself. The High Court or for that matter, the Tribunal did not have the advantage of opinion of the expert to the effect as to whether crushed bones can be used only for the purpose of fertilizer or whether crushed bones are sold to the farmers for use thereof only as fertilizer." The said question was left open for subsequent cases. In one of the cases, namely, Commissioner, Trade Tax, U.P. Lucknow v M/s Noori Manthor Mill, Muradabad Road Sabal, the Tribunal has arrived at the finding of fact "Because on the crushed bones there is a tax liability at the rate of 6 percent but against the crushed bones, no description of horns and bones has been made that is to say that the purpose of the government is to charge tax on the crushed bones and not to charge tax on the crushed bones and horns. This was also pleaded by the learned counsel that the crushed horns and Hooves are used as manufacture (sic). And it cannot be put to any other use. The department has not led any such evidence which may conclude that the crushed horns and hubes (sic) are used for any other purpose than the manure and that the manure is a tax free commodity." ;