- (1.) LEAVE granted.
(2.) THIS appeal is directed against a judgment and order dated 18/8/2006 passed by a Division Bench of the Kerala High Court in s. T. R. V. No. 451 of 2004 allowing a revision application filed by the state of Kerala and thereby restoring the order of assessment of 'purchase turnover' of aluminium scrap and old utensils and vessels at the rate applicable as provided for under Entry 83 of the First Schedule of the Kerala General Sales Tax Act, 1963 (for short "the Act" ). Appellant herein is a dealer within the meaning of the provisions of the Act. It manufactures aluminium utensils from scraps out of old utensils made of aluminium and aluminium alloys. The First Schedule appended to the Act contains entries concerning aluminium and household utensils, which read as under: JUDGEMENT_5514_AIR(SCW)_2008Html1.htm Indisputably, prior to its amendment which took place on 23/2/1992, the word "and" occurred in between "aluminium" and "household utensils made of aluminium" in Entry 5 aforementioned. The Assessing Authority held that in the instant case Entry 83 was attracted. The Appellate Authority upheld the said view. In a second appeal preferred before the Sales Tax Appellate Tribunal, however, a different view was taken opining that despite omission of the word "and" occurring in between the words "aluminium" and "household utensils made of aluminium", the same should be read, holding: ". . . What the appellant purchased was old aluminium vessels and aluminium scrap and used the same in the manufacture of aluminium household utensils. The rate of tax applicable in respect of the purchase turnover taxable under section 5a is disputed. According to the authorities below old Aluminium vessesls and aluminium scraps will not come under entry 5 of the 1st Schedule, but can be taxed only under entry 83 of the said schedule. We reproduce below the relevant entries which are valid from 1-4-1992. "
(3.) ALUMINIUM household utensils F. S. 4% whether made of aluminium and aluminium alloys 83. Metal scraps other than those F. S. 8% specified in the second schedule we find much force in the contention of the learned Advocate of the appellant that entry 5 as such viz. , "aluminium household utensils made of aluminium. . . " does not make any sense. The earlier entry before recasting was "aluminium and household utensils made of aluminium" also. We are of the view that the intention of the legislature was to retain the old entry as such but an inadvertent omission of the word "and" was occurred while recasting the schedule. However, even in the relevant entry, aluminium and household utensils made of aluminium are clearly embedded. We find that in the light of the present entry 5, old aluminium vessels and aluminium scrap purchased need not be taxed under entry 83 which takes in "metal scraps not mentioned elsewhere in Schedule II". Revision applications were filed thereagainst by the State of kerala before the High Court and by reason of the impugned judgment, it reversed the decision of the Tribunal, opining: "we are unable to accept this contention for more than one reason. In the first place, even if aluminium independently comes under Entry 5, aluminium scrap cannot be treated as aluminium as such. Probably scrap aluminium predominantly consists of aluminium but still it cannot be said to be aluminium pure and simple. It is common knowledge that scrap is always melted or otherwise processed to recover the metal after removing the waste. Therefore, aluminium scrap is used to recover aluminium after removing the waste. Secondly, the intention of the Legislature to bring all metal scrap under Entry 83 is very clear from the wording itself which excludes from its scope only such of the metal scraps which are referred to in Second Schedule to the KGST act. Therefore, a clear reading of Entry 83 makes it clear that all metal scrap other than iron and steel scrap referred to in Second schedule will fall under Entry 83. Since aluminium is a metal, all items purchased in the form of aluminium scrap or old aluminium vessels will fall under Entry 83. As already held, aluminium scrap cannot be treated as aluminium falling under Entry 5 and so much so, we are unable to sustain the finding of the tribunal to the contrary. . . " Mr. Sreekumar, learned counsel appearing on behalf of the appellant, raised the following contentions: (i) As the Assessing Authority in the earlier years of assessment had taken the view that Entry 5 is attracted in terms whereof 4% tax was only to be levied, the same should have been followed by it. (ii) Once utensils have been subjected to sales tax, no purchase tax can be levied thereon in view of Section 5a of the Act. ;