Case: Member, Board of Revenue, West Bengal Vs. Messrs Phelps and Company Private Limited

2. The material facts are these :Messrs. Phelps & Co. (Private) Ltd., the assessee is a company incorporated under the Indian Companies Act, 1913 having its Registered Office in New Delhi. It is carrying on business, amongst other places, at Calcutta. It was registered as a dealer under the Bengal Finance (Sales Tax) Act., 1941 and was carrying on the business of tailors, drapers,and industrial gloves manufacturers.3. In respect of the assessment for the 4 quarters ending on the 31st March, 1957 the said dealer in its claim for exemption under section 5 (2)(a)(ii) of the Act, included the following transactionsSales to M/s. The Indian Iron and Steel Co. Ltd. for Rs. 51,Sales to M/s. Indian Standard Wagon Co. Ltd. for Rs. 20,Sales to M/s. The Hoogly Docking & Engineering Co. Ltd. for Rs.The Commercial Tax Officer, Esplandde Charge, who assessed the dealer found that the above transactions related to the sales of different types of hand gloves which the purchasing dealers purchased for the purpose of the same being used by their workers while being engaged in work in the factories. He by his order, dated 4th December, 1957 observed that the purchase of hand gloves could not be called as being required for the purpose of manufacture of goods for sale, and, accordingly, disallowed the dealers claim for exemption of Rs. 72,That order was affirmed by the Assistant Commissioner of Commercial Taxes in appeal as well as by the Board of Revenue. Thereafter the assessee company filed a petition under section 21(1) of the Act asking the Board of Revenue to refer certain question of law to the High Court. The Board refused to refer those questions. Dissatisfied by the order of the Board, the dealer moved the High Court of Calcutta under section 21(2) of the Act for direction to the Board to state a case. The High Court accepted that petition and directed the Board to state the case and submit the questions that the assessee company wanted it to submit to the High Court.

Reasoning:
In the present case the assessee company has sold the goods in question to certain manufacturers who were manufacturing iron steel materials. It is also clear from question No. (i) that those gloves were to be used by workmen who were engaged in hot jobs or in handling corrosive substance in the course of manufacture. That being so it cannot be denied that those gloves had to be used in the course of manufacture.7. Mr. B. Sen, learned counsel for the Board of Revenue, contended that section 5(2)(a)(ii) takes in only such goods which are actually used in the manufacture and those goods which are used in the course of manufacture. It is not necessary for us to examine that contention in view of the decision of this court to which we have already made a reference. We are bound by the notion of that decision.