STATE OF MADHYA BHARAT NOW STATE OF MADHYA PRADESH OTHERS Vs. HIRALAL JI

JUDGEMENT

(1.) THE following Judgment of the court was delivered by

(2.) THIS appeal by special leave raises the question of the intepretation of Item No. 39 of the Notification No. 58, dated 24/10/1953, hereinafter called the 'Notification', issued by the government of Madhya Bharat under the Madhya Bharat Sales Tax Act, Samvat 2007 (Act No. 30 of 1950), hereinafter called the Act.

(3.) LEARNED counsel for the State contends that the expression `iron and steel` means iron and steel in the original condition :-and not iron and steel in the shape of bars, flats and plates. In our view, this contention is not sound. A comparison of the said two Notifications brings out the distinction between rawmaterials of iron and steel and the goods prepared from iron and steel : while the former is exempted from tax, the latter is taxed. 'Therefore, iron and steel used as raw-material for manufacturing other goods are exempted from taxation. So long as iron and steel continue to be raw-materials, they enjoy the exemption. Scrap iron purchased by the respondent was merely re-rolled into bars,flats and plates. They were processed for convenience of sale.The raw-materials were only re-rolled to give them attractive and acceptable forms. They did not in the process lose their character as iron and steel. The dealer sold `iron and steel` in the shape of bars, flats and plates and the customer purchased `iron and steel` in that shape. We, therefore, hold that the bars, flats and plates sold by the assessee are iron and steel exempted under the Notification. The conclusion arrived at by the High court is ,correct.