N. K. JAIN, J. - (1.) THESE revisions under section 15 (1) and (2) of the Rajasthan Sales Tax Act are directed against the orders of the Sales Tax Tribunal, Ajmer, dated July 5, 1988 and July 5/6, 1988.
(2.) THE assessee is a registered dealer under the Rajasthan Sales Tax Act, 1954, engaged in the sale and purchase of old gold ornaments. THE assessee during the different accounting years 1975-76, 1976-77, 1977-78, 1980-81 and 1981-82 purchased old ornaments. THE assessee removed the precious and semi-precious stones and after breaking them into pieces sent them to Bombay Mint for pure plates of gold and on return, sold the "bullion" in the course of inter-State trade and commerce and paid purchase tax at the rate of 1 per cent. At the time of original assessment as no tax on the purchase of ornaments was levied, a notice under section 12 was issued to the assessee for escapement of purchase tax. THE assessing authority levied purchase tax under section 5a on ornaments at the rate of 5 per cent as manufacture of pure gold (bullion) was not made within the State of Rajasthan. THE assessing authority also imposed interest payable under section 11b of the Act, vide assessment order dated June 24, 1983. THE assessee moved an appeal before the Deputy Commissioner (Appeals), Commercial Taxes, Bikaner, and the same was rejected on September 29, 1984. THE assessee preferred a revision before the Board of Revenue, Ajmer, which stood transferred to the Rajasthan Sales Tax Tribunal, Ajmer, on its formation under the provisions of section 13 of the Rajasthan Sales Tax (Amendment) Act, 1984. THE learned Tribunal relied on the decision of this Court in Assistant Commercial Taxes Officer v. Shankarlal Ghanshyamdas reported in [1987] 67 STC 208 and held that the assessee is not liable to pay purchase tax at the rate of 5 per cent but imposed purchase tax at the rate of 1 per cent under section 5a read with Section 5c. THE learned Tribunal also held that as the assessment is made under section 12, interest under section 11b is not leviable and set aside by its common order dated July 5, 1988 for the assessment years 1975-76, 1976-77, 1977-78 and 1981-82. THE assessee preferred two revisions - S. B. Sales Tax Revision No. 436 of 1988 for the assessment years 1975-76, 1976-77 and 1977-78 and S. B. Sales Tax Revision No. 435 of 1988 for the assessment year 1981-82 challenging that they are not liable to pay purchase tax at the rate of 1 per cent raising following relevant question of law : 4. 4. Whether, in the facts and circumstances of the case, purchase tax can be levied merely because goods were sent for refining to the Government Refinery at Bombay because there was no facility of refining available within the State of Rajasthan. The department has also filed three revisions, S. B. Sales Tax Revision No. 73 of 1989, S. B. Sales Tax Revision No. 75 of 1989 and S. B. Sales Tax Revision No. 76 of 1989 raising following questions of law, challenging that the department is entitled to get tax at the rate of 5 per cent with interest : 1. Whether, in the facts and circumstances of the case, the Tribunal was justified in reducing the rate of tax on purchases of ornaments from 5 per cent to 1 per cent ? 2. Whether, in the facts and circumstances of the case, the Tribunal was justified in holding that the assessee is entitled to benefit under section 5c of the Rajasthan Sales Tax Act ? 3.Whether, in the facts and circumstances of the case, the Tribunal was right in holding that interest under section 11b cannot be charged when escaped tax is assessed by proceedings under section 12 of the Act ? As agreed by the learned counsel for the parties these revision petitions are disposed of by this common order. Mr. B. C. Mehta, learned counsel for the department, submits that for claiming exemption the goods should be used within the State and the entire manufacturing was to be carried out within the State and, therefore, the assessee is not entitled to take benefit of section 5c and liable to pay purchase tax at the rate of 5 per cent under section 5a of the Rajasthan Tax Act. Mr. Kothari submits that the case reported in Assistant Commercial Taxes Officer v. Shankarlal Ghanshyamdas [1987] 67 STC 208 (Raj) is fully applicable and the learned Tribunal has erred in imposing tax at the rate of 1 per cent under section 5a read with section 5c of the Rajasthan Sales Tax Act. I have heard learned counsel for the parties and have perused the record. It is not disputed that the assessee purchased old ornaments from the customers and removed precious and semi-precious stones. The assessee melted them to convert into pure gold meaning thereby the assessee has done some process, i. e. , removing precious stones and melting them into mass of gold in the State and thereafter "lugdi" was sent to Bombay Mint as further process of die-casting was not available in the State of Rajasthan and on return "bullion" was sold after paying tax. The learned Tribunal has observed that the ownership of property remained throughout with the assessee and relied on Assistant Commercial Taxes Officer v. Shankarlal Ghanshyamdas [1987] 67 STC 208 (Raj ). The Tribunal has further held that as the process of refining was not available in the State of Rajasthan, the purchase tax cannot be levied at the rate of 5 per cent which is applicable to gold ornaments but leviable at the rate of 1 per cent under section 5a read with section 5c. The department has not been able to establish that no process has been done in Rajasthan, therefore, the argument that the purchase tax should be leviable at the rate of 5 per cent is not tenable. In view of the fact that the Tribunal has not given specific finding, therefore, in the interest of justice, I deem it proper to remand the matter to the Tribunal to decide afresh as to whether purchase tax under section 5a would be still leviable or not.
(3.) SECTION 11b relating to charge of interest came into existence on 2nd May, 1969 and it was later on substituted by section 8 of the Rajasthan Act No. 4 of 1979 with effect from April 7, 1979. In the explanation to sub-section (1) of section 11b, section 12 was added for the first time by section 10 of the Rajasthan Sales Tax (Amendment) Act, 1987, with effect from April 1, 1987. Admittedly the cases pertain to prior to the coming into force of this section and, therefore, apparently interest cannot be levied as it is not applicable. Thus, the learned Tribunal was right in setting aside the interest. Further this point is squarely covered by the decision of this Court rendered in Commercial Tax Officer v. Nalwaya Minerals and Motor Parts [1989] 30 STL 151 (Raj ). Accordingly, all these revisions stand disposed of as observed above. .;