COMMISSIONER, COMMERCIAL TAX Vs. SAHOTA PAPERS LTD
LAWS(UTN)-2012-3-37
HIGH COURT OF UTTARAKHAND
Decided on March 13,2012

Commissioner, Commercial Tax, Uttarakhand, Dehradun Appellant
VERSUS
M/s Sahota Papers Ltd., Village Narainpur, Tehsil - Jaspur, District U.S. Nagar Respondents

JUDGEMENT

- (1.) The respondent manufactures and sells Duplex Coated Board, Mill Board and Grey Board. It applied to the Commissioner under Section 57 of the Uttarakhand VAT Act, 2005 for the purpose of answering the question "whether the products manufactured by the respondent can be said to be articles of packing ?" The Commissioner answered that question by holding that it can not be said that Duplex Coated Board, Mill Board and Grey Board are exclusively used as articles of packing, since they are also used for other purposes. Aggrieved by the answer thus given by the Commissioner, the respondent approached the Tribunal. Tribunal found that Hon'ble Allahabad High Court has, by certain reported judgments, held that Duplex Coated Board, Mill Board and Grey Board are articles of packing. It then took the view that in view of such pronouncement of the Hon'ble Allahabad High Court, it must be deemed that Duplex Coated Board, Mill Board and Grey Board are commonly used in the commercial parlance as articles of packing. It accordingly, held that Duplex Coated Board, Mill Board and Grey Board are articles of packing. Aggrieved thereby the present revision has been filed. It is the contention of the Revenue in the present revision that whereas, "articles of packing" is one of the items of Schedule II (B) of the Act, Duplex Coated Board, Mill Board and Grey Board are not items mentioned in the said Schedule and, accordingly, in terms of Section 4(2) of the Act, sale of Duplex Coated Board, Mill Board and Grey Board will attract tax at the rate of 12 1/2 per cent. It was contended that when Duplex Coated Board, Mill Board and Grey Board are not sold for the purpose of conversion thereof into articles of packing, but are sold for using the same for some other purpose, it cannot be said that the goods in question namely Duplex Coated Board, Mill Board and Grey Board will or can be termed as articles of packing. The contention is not acceptable as liability to pay tax accrues on sale and not on user of the goods sold after sale has taken effect. The item mentioned in Entry No. 9 of Schedule II (B) of the Act is "articles of packing". It does not stop after indicating the item as "articles of packing". It says including boxes, cartoons, etc. Therefore, articles of packing will not remain restricted to those which have been mentioned in Entry No. 9 of the said Schedule. Articles of packing may be more than those which have been mentioned in Entry no. 9 of the Schedule. There is no dispute that the boards manufactured and sold by the respondent may be used also for making boxes, cases and cartoons. The legislature, therefore, while giving an inclusive definition and indicating that boxes, cases and cartoons are also included, also brought within the ambit of "articles of packing", materials used for manufacture of such boxes, cases and cartoons, namely, those boards manufactured and soled by the respondent. At the same time, the fact remains that those boards can be used for some other purpose also. In such a situation, the Tribunal has held that the test is what the material is regarded in the commercial world in common parlance. Applying the said test and nothing that the Hon'ble Allahabad High Court has declared in reported judgments that those boards are articles of packing, the Tribunal held that in commercial world and in common parlance, user of such boards is as articles of packing and, accordingly, would come within the inclusive meaning of articles of packing mentioned in Entry No. 9 of Schedule II (B) of the Act. That being the basis of the conclusion, we are of the view that there is no scope of interference with the judgment and order of the Tribunal. The Revision is accordingly disposed of.;


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