KILBURN AND CO LTD Vs. COMMISSIONER OF SALES TAX U P LUCKNOW

JUDGEMENT

(1.) THIS is a reference under section 11(1) of the U.P. Sales Tax Act. The Additional Judge (Revisions), Sales Tax, Lucknow, at the instance of the assessee, has referred the following question for the opinion of this court :

(2.) THE relevant notification is ST-3124/X-1012(4) dated 1st July, 1966. It is a notification under section 3-A of the Act and prescribes a rate of 6 per cent. on the turnover of "paper other than hand-made paper". The contention put forth on behalf of the assessee is that the articles in question, even though called as paper, are, in fact, not paper at all, and, as no specific rate of tax has been prescribed for these articles in any of the notifications issued by the State Government, they must be regarded as unclassified goods and charged to tax at the general rate of 2 per cent. at multiple points. Admittedly, ammonia paper and ferro paper are chemically coated paper used for obtaining prints and sketches of site plans. The prints and sketches of site plans are obtained not by pen or pencil but by the chemical coating on the paper. If exposed to light for a long time, the chemical evaporates and what is left behind is not used for drawing or for any other purposes for which a paper is used. The process by which ammonia and ferro paper is produced is not set out in the order passed by the sales tax authorities, but in paragraph 6 of the assessee's revision application, the process has been set out, which seems to have been admitted between the parties. This is what has been stated in paragraph 6 :

(3.) WITH the above observations, their Lordships rejected the contention of the sales tax department that those articles could be regarded as dyes and colours and scents and perfumes. A similar question was examined by this court in Kores (India) Ltd., Kanpur v. State of U.P. and Another ([1970] 26 S.T.C. 126). This very notification was considered with reference to carbon-paper. This is what the court observed :