TATIA, J. - (1.) THE petitioner has raised questions of law in these revision petitions that (i) whether in the facts and circumstances of the case supply of explosives by the petitioner to his contractor for using the same by the contractor in petitioner's mining operation in mining area of the petitioner can be treated to be a sale within the meaning of Rajasthan Sales Tax Act, 1994 (hereinafter referred to as the Act of 1994) and (ii) if answer to question no. (i) referred above is affirmative and it is held that aforesaid supply of explosives is a sale whether such sale is not taxable being subsequent sale within the State of the goods on which tax on first point has already paid and (iii) whether in the facts and circumstances of the case, the explosives for the purpose of blasting in the petitioner's mine could not have been purchased at concessional rates against declaration form ST17.
(2.) THE petitioner is a company duly registered under the provisions of the Rajasthan Sales Tax Act, 1994, Rajasthan VAT Act, 2003, Central Sales Tax Act, 1956 and the Rules framed thereunder. THE company engaged in manufacture of lead, zine and allied metals and it has is own mines. In the regular course of business, the petitioner company awarded various mining contracts to the contractors wherein cement and steel are required to be used. THE petitioner company is required to use explosives for winning minerals from its mines. This operation includes explosions and is got done on job work basis in the field of the petitioner under strict control and supervision of explosive experts. For use of explosives, the petitioner company is required to obtain licence from the competent authority under the Explosive Act, 1884 and as per the statutory condition of licence, the petitioner cannot re-sale the explosives purchased for its own use. THE petitioner has placed on record the copy of the explosive licence. THE petitioner company purchased the explosives against declaration form ST17 on payment of concessional rate of tax as stipulated under Section 10 (1) and 10 (3) of the Act of 1994. According to the petitioner explosives have been mentioned in the certificate of registration of the petitioner company as raw-material and, therefore, the petitioner is authorized to purchase the same at concessional rate of 4% against declaration form ST17. The petitioner's company's regular assessment for the tax under the provisions of the Act of 1994 for the assessment years 1999- 2000, 2000-2001, 2001-2002, 2002-2003 AND 2003- 2004 were framed by the assessing authority, but notices were issued for re-opening of assessments under Section 30 of the Act of 1994 to the petitioner on the ground that supply of material such as cement, iron, steel and explosives to various contractors firms is sale within the meaning of Section 2 (38) of the Act of 1994. The petitioner submitted reply and took the plea that the goods have not been used for the purpose other than for which they have been procured and there is no misuse of declaration form. The petitioner submitted that ownership of the goods had never been transferred to the contractor and the contractor had returned the remaining goods as such and no property stands transferred to the contractor from the petitioner, therefore, the transaction cannot amount to sale of the goods liable for tax under the provisions of the Act of 1994. The assessing authority rejected the petitioner's contention and passed assessment orders for various years. Copies of the assessment orders passed for various years have been placed on record on these revision petitions, which are dated 7. 8. 2003, 27. 9. 2005 and 15. 2. 2006 in total for five years. Aggrieved against the above assessment orders passed by the assessing authority, the petitioner company preferred separate appeals before the Dy. Commissioner (Appeals) Commercial Taxes, Udaipur, which were dismissed by Dy. Commissioner (Appeals) by order dated 6. 1. 2005 (two appeals), dated 21. 6. 2005 (two appeals) and dated 5. 10. 2006 (one appeal ). The petitioner preferred further appeals before the Rajasthan Tax Board, Ajmer, which too were dismissed by the Rajasthan Tax Board, Ajmer vide order dated 6. 3. 2007, hence, these revision petitions raising common questions of law referred above. According to learned counsel for the petitioner the petitioner has its own mining area. In the mining operation certain goods including explosives are required for which the petitioner company obtained licence from the competent authority under the relevant provisions of law which is apparent from the copy of the licence placed on record by the petitioner. The petitioner company cannot sale the explosives and has not sold it out to anybody. The petitioner company gave these explosives to its contractor only for using the explosives in petitioner's own mining operation. The explosives exhausts in the mining operation and after its use nothing remained in the hands of the contractor. As per the contract between the petitioner and its contractor, the contractor could have used the explosives within the mining field of the petitioner and that too, under the strict control and supervision of the explosives experts. Therefore, no legal title of the goods had passed on to the contractor. The petitioner company could have used its explosives through its own labour for its own consumption and as per sub-section (3) of Section 10, the petitioner was entitled to purchase the goods for its mining operation on payment of lower rate of tax i. e. , @ 4% on furnishing a declaration duly filled under form ST14. The petitioner consumed the explosives in its mining operation is not in dispute, therefore, the petitioner fulfilled all the conditions of sub-section (3) of Section 10 of the Act of 1994 and has not violated the conditions as provided by sub-section (3) of Section 10 of the Act of 1994 after purchase of the goods i. e. , explosives. In view of the above fact, the first contention of the petitioner is that the explosives in the hands of contractor is not the goods sold to the contractor and secondly, even if it amount to sale then as per sub-section (3) of Section 10 of the Act of 1994, the sale is not prohibited to a person who uses the said sold goods only for the purpose and use of the seller. Learned counsel for the petitioner tried to distinguish allege sale of explosives by the petitioner company to its contractor for carrying out work of petitioner with the sale of goods to other person who may not use the goods for carrying out the manufacture in process or mining operation of the seller and submitted that in former cases there cannot be violation of sub- section (3) of Section 10 of the Act of 1994 because of the reason that the petitioner company is required to satisfy that the goods purchased by the petitioner company by submitting a declaration under form ST17 were required by it and has been used for its mining operation. Sub-section (3) of Section 10 of the Act of 1994 nowhere provides that in case the goods are required by the assessee and has been used for the assessee's own work but through third party then the assessee is not entitled to get benefit of payment of tax at lower rate as provided under sub- section (3) of Section 10 of the Act of 1994.
(3.) LEARNED counsel for the petitioner further submitted that the petitioner purchased the goods i. e. , explosives after payment of tax under sub-section (3) of Section 10 of the Act of 1994 though on payment of lower rate of tax under sub-section (3) of Section 10 by furnishing declaration form ST 17, therefore, the explosives in the hands of the petitioner is tax paid goods, therefore, even if it is held that handing over of the explosives to the contractor of the petitioner company for the purpose of mining operation within the mining area of the petitioner amounts to sale then that sale is sale of tax paid goods and the tax can be levied within the State only ones and not on subsequent sales. LEARNED counsel for the petitioner relied upon the judgment of this court delivered in Shekhawat Explosives vs. State of Rajasthan & Ors reported in 2003 (5) Tax Update 155 = (RLW 2003 (1) Raj. 648 ). Facts of which case was slight different but learned counsel for the petitioner relied upon this judgment in support of his argument that since the explosives exhausts in the mining operation therefore, cannot be transferred to the petitioner company by the contractor, therefore, the goods in the hands of the contractor is not a commodity acquired by sale. Learned counsel for the petitioner also relied upon the judgment of this Court delivered in the case of Bharat Sanchar Nigam & Anr. vs. Union of India & Ors reported in 2006 (14) Tax Update 185. Learned counsel for the revenue submitted that in the present case the petitioner not only delivered the explosives to its contractor but also recovered the cost of the explosives from the contractor and this fact is not in dispute. Therefore, the transaction of sale stands completed by delivery of goods to the contractor engaged by the petitioner for execution of their works contract and receipt of the sale consideration by the seller - petitioner company. Sale is not determined from the fact that how the purchaser (contractor) has used or consumed the goods or where the purchaser (contractor) has used the goods. The completed sale transaction is not affected because of total exhausts of the sold goods after reaching it in the hands of purchaser, therefore, where and how the purchaser; the contractor of the petitioner company, has used the explosives is absolutely irrelevant and transaction stands concluded before goods used by the contractor. ;