Satish Chandra, C.J. - (1.) The question of law raised by the Commissioner of Sales Tax in this revision is whether the turnover of Rs. 22,69,015 was taxable without affording the concessional rate of tax on the purchases of raw materials proportionate to the production of oil to that extent.
(2.) It appears that the assessee which manufactures vegetable ghee obtained a recognition certificate for purchase of raw materials for producing the vegetable ghee. Vegetable ghee or vegetable oil was a notified product. Under the recognition certificate the assessee purchased oil-seeds worth Rs. 2,97,93,000. It is not disputed that the assessee also purchased oil-seeds worth Rs. 28,95,000 without form III-B. Such purchases appears to have been made from outside the State. The assessee produced vegetable oil worth Rs. 6,65,73,925. Out of these, the sales within the State of Uttar Pradesh or in the course of inter-State trade were worth Rs. 6,43,04,910, leaving a balance of Rs. 22,69,015 which admittedly were transferred to the assessee's depots at Patna and Jaipur and were sold from those depots. The assessing authority estimated that the vegetable oil worth Rs. 22,69,015 could be produced from raw materials, namely, oilseeds, which would be worth Rs. 19,30,000. They imposed purchase tax on oil-seeds to the extent of Rs. 57,900 without giving the benefit of concession based on the recognition certificate. This view of the assessing authority was upheld in appeal but the tax was reduced to Rs. 35,640. The assessee went up in revision. The Judge (Revisions), relying upon a decision of this Court in Chittarmal Ram Dayal v. Commissioner of Sales Tax, Uttar Pradesh 1980 UPTC 274, held that the concessional rate of tax could not be withheld even on this part of the turnover as there was no violation of the provisions of Section 4-B(6) of the U. P. Sales Tax Act. Aggrieved, the department has come to this Court in revision. ,;
(3.) On facts, the position is clear that of the quantity of oil-seeds purchased by the assessee under form Ill-B the entire production was sold within the State of Uttar Pradesh or in the course of inter-State sales. The purchases of oil-seeds under form III-B were to the extent of Rs. 2,97,93,000. From this quantity of oil-seeds, not much more than Rs. 3,00,00,000 worth of oil could be produced keeping in mind that the assessing authorities had themselves estimated that oil worth Rs. 22,00,000 and odd could be produced from oil-seeds worth Rs. 19,00,000 and odd. The actual sales of oil by the assessee within the State of Uttar Pradesh or in the course of inter-State trade were more than Rs. 6,00,00,000. Thus, it could be said that the entire production of oil from oil-seeds purchased under form III-B was sold within the State of Uttar Pradesh or in the course of inter-State trade.;