Case: Mohanlal Hargovinddas Vs. State Of Madhya Pradesh &amp; Ors

of goods specified in such dealers certificate of registration as being intended for use by him as raw materials in the manufacture of any goods for sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State, and of containers and other materials used in the packing of such goods;" Section 4(6) of the Act was also inserted with effect from December 1, 1953 by the Madhya Pradesh Sales Tax (Amendment) Act, 1953 (Act XX of 1953). In consequence of these amendments it became necessary to amend the certificate of registration granted to the appellant before the amendment of the Act. Therefore, on January 5, 1954 even before the relevant Rule was amended, the appellant applied for substitution of the words "raw materials" for the words "for the purpose of manufacture". In allowing the application the Sales Tax Officer did not comply with the language of Form II but merely specified as raw materials "Tendu leaves, Tobacco, Yarn". The contention of the appellant is that the purchase of tobacco cannot be taxed because it was not "specified in the dealers certificate of registration as intended for use by him as raw materials in the Manufacture of any goods for the purpose of sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State" as required by S. 4 (6) of the Act. We are unable to accept the argument of the appellant as correct. It is true that there is a technical omission in the order of the Sales Tax Officer amending the certificate of registration, but the certificate must be fairly construed in the light of the language of S. 8 and other relevant provisions of the Act. Before the amendment made by Act XX of 1953, S. 8 (3) read as follows :"8. (3) If the said authority is satisfied that an application for registration is in order, it shall in accordance with such rules as may be made under this Act, register the applicant and grant him a certificate of registration in the prescribed form which, in the case of a registered dealer who himself manufactures any goods for purposes of sale shall specify the class or classes of goods which are intended to be used by him in the manufacture of such goods." After the amendment the sub-section was to the following effect :"8. (3) If the said authority is satisfied that an application for registration is in order, it shall in accordance with such rules as may be made under this Act, register the applicant and grant him a certificate of registration in the prescribed form which in the case of a registered dealer who manufactures any goods for purposes of sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State shall specify the raw materials which are intended to be used by him in the manufacture of such goods." In this connection reference may be made to S. 2 (j) (a) (ii) which states that a selling dealer is entitled to deduct from his turnover sales to a registered dealer of goods "specified in such dealers certificate of registration as being intended for use by him as raw materials in the manufacture of any goods for sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State". It is manifest that the only legitimate object which the purchasing dealer seeks in having a class of goods specified in the certificate of registration as "raw materials" is to purchase the goods tax-free in the sense contemplated by the Act. By asking for such specification the dealer represents that he intends to use the goods specified in the manufacture of other goods for the purpose of sale by actual delivery in the State of Madhya Pradesh for the purpose of consumption that State. In this context reference should be made to declarations made by the appellant to the Bombay dealers printed at page 88 of the Paper Book. In these declarations the appellant stated that it was purchasing tobacco for use as raw materials in the manufacture of goods for sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State and that tobacco was so specified in its certificate of registration. As we have already said, the certificate of registration granted to the appellant must be construed in the context of S. 8 as it stood after its amendment and the declarations of the appellant made to the Bombay dealers. If the language of the certificate is so construed in the context of the amended S. 8 of the Act and along with the declarations of the appellant, it is manifest that the appellant is liable to pay tax on tobacco imported from Bombay dealers for the relevant periods and that the requirements of S. 4 (6) of the Act are satisfied in this case. The view that we have taken is borne out by the decision of this Court in Modi Spinning and Weaving Mills Co. Ltd. v. Commissioner of Sales Tax, Punjab, 1965-16 STC 310 : (AIR 1965 SC 957 ) in which it was held that the registration certificate was only evidence that the assessee was a registered dealer for purposes of certain commodities to be used in manufacture and any formal defect in the registration certificate was not material. We, therefore, hold that the technical omission of the Sales Tax Officer to make a specific entry in the certificate will not confer any benefit on the appellant if there is other incontrovertible evidence in the case to how that the appellant did purchase the goods specified in the certificate as raw materials in the manufacture of any goods for the purpose of sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State. We, therefore, hold that Mr. A. K. Sen has not been able to make good his argument on this aspect of the case.

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]In this connection reference may be made to S. 2 (j) (a) (ii) which states that a selling dealer is entitled to deduct from his turnover sales to a registered dealer of goods "specified in such dealers certificate of registration as being intended for use by him as raw materials in the manufacture of any goods for sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State". It is manifest that the only legitimate object which the purchasing dealer seeks in having a class of goods specified in the certificate of registration as "raw materials" is to purchase the goods tax-free in the sense contemplated by the Act. By asking for such specification the dealer represents that he intends to use the goods specified in the manufacture of other goods for the purpose of sale by actual delivery in the State of Madhya Pradesh for the purpose of consumption that State. In this context reference should be made to declarations made by the appellant to the Bombay dealers printed at page 88 of the Paper Book. In these declarations the appellant stated that it was purchasing tobacco for use as raw materials in the manufacture of goods for sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State and that tobacco was so specified in its certificate of registration. As we have already said, the certificate of registration granted to the appellant must be construed in the context of S. 8 as it stood after its amendment and the declarations of the appellant made to the Bombay dealers. If the language of the certificate is so construed in the context of the amended S. 8 of the Act and along with the declarations of the appellant, it is manifest that the appellant is liable to pay tax on tobacco imported from Bombay dealers for the relevant periods and that the requirements of S. 4 (6) of the Act are satisfied in this case. The view that we have taken is borne out by the decision of this Court in Modi Spinning and Weaving Mills Co. Ltd. v. Commissioner of Sales Tax, Punjab, 1965-16 STC 310  : (AIR 1965 SC 957  ) in which it was held that the registration certificate was only evidence that the assessee was a registered dealer for purposes of certain commodities to be used in manufacture and any formal defect in the registration certificate was not material. We, therefore, hold that the technical omission of the Sales Tax Officer to make a specific entry in the certificate will not confer any benefit on the appellant if there is other incontrovertible evidence in the case to how that the appellant did purchase the goods specified in the certificate as raw materials in the manufacture of any goods for the purpose of sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State. We, therefore, hold that Mr. A. K. Sen has not been able to make good his argument on this aspect of the case.