Case: Indra Singh and Sons Private Limited Vs. Sales Tax Officer, Raigarh Circle, Raigarh and Others

2. The appellant is alimited liability private company carrying on the business of mining coal and trading in coal and coke as owner of the mines and the business known as West Chirimiri Colliery at Chirimiri in the district of Surguja in that State of Madhya Pradesh. The appellant applied for registration as a dealer under section 7 of the Central Sales Tax Act (74 of 1956)hereinafter referred to as the Central Actin Form A prescribed by the Central Sales Tax (Registration and Turnover) Rules, 1957hereinafter referred to as the Central Rules. In that application it described the business as "wholly mining and wholesale distribution of coal mainly", and in column 16 listed the following goods or classes of goods purchased by it in the course oftrade for use in the production of coal :"Explosives, lubricants, fuel, timber, machinery, colliery stores, etc."It was granted a certificate of registration dated June 27, 1957, and the business was described as "wholesale distribution of coal" and the only classes of goods included were lubricant oil, fuel, and explosives.3. On July 2, 1957, the appellant wrote to the Sales Tax Officer, Raigarh, stating that only lubricant oil, fuel and explosives had been mentioned in the certificate of registration but there were other stores which ought to have been included. The Sales Tax Officer replied that the expression "in the manufacture of goods" denotes only such goods as were consumed or directly utilised in the process of manufacture or formed part as an ingredient of the finished goods such as plants, machinery, tools, stores, etc., and ingredients of buildings for staff, conveyances or parts of it for transport of goods, etc., could not form a part of the manufacturing process and hence could not be specified in the certificate of registration in order to purchase goods for use in the manufacture of goods for sale.Dissatisfied with the reply of the Sales Tax Officer, the appellant applied to him for inclusion of various other items of goods, and the Sales Tax Officer amended the certificate adding various other categories. Another amendment was granted by the Sales Tax Officer on or about November 25, 1957, adding fuel and diesel oil. The appellant was still not satisfied and filed another application on or about May 15, 1958, praying for inclusion of 27 more items. The Sales Tax Officer amended the certificate again including 14 items, but excluded iron and steel (heavy and light), medicines and insecticides, welding sticks, sanitary fittings, spare parts for motor vehicles including tyres and tubes, furniture, stationery and motor trucks. The appellant pressed his claim by another application dated August 21, 1959, but the Sales Tax Officer by his order dated September 30, 1959, refused to accede to the request. The Sales Tax Officer informed the appellant as follows :"Iron and steel is a declared commodity vide section 14 of the Central Sales Tax Act and hence cannot be specified in the registration certificate for purposes of manufacture of goods for sale.As regards motor trucks and spare parts for motor vehicles including motor tyres and tubes, I have to repeat that as they are not directly used for the production of coal they cannot be specified in your registration certificate."4. Thereupon the appellant filed a revision under section 39(1) of the Madhya Pradesh General Sales Tax Act (Madhya Pradesh Act II of 1959). The Commissioner of Sales Tax by his order dated August 16, 1960, upheld the order of the Sales Tax Officer. On February 6, 1961, the appellant filed an application under Articles 226 and 227 of the Constitution. The High Court dismissed the application by its order dated October 12, 1961.

Reasoning: But on looking through the record, we find that this is the first time that this point is being made in the course of these proceedings. In the application for registration before the Sales Tax Officer no mention is made that the appellant is carrying on the business of manufacturing coke. In its application under Article 226 in the opening para it only mentions that it is carrying on the business of mining coal and trading in coal and coke, as the owner of the mines. The learned counsel has not been able to point out any documentary evidence to show that the appellant was actually manufacturing coke, and, therefore, we cannot allow him to raise this new point at thisare unable to accept the submissions of the learned counsel. We cannot read the expression "in mining" in rule 13 of the Central Rules to mean in the business of mining. The goods must be intended for use only in the actual activity of mining which would include raising the coal and storing it in heaps or in warehouses. But in our opinion the expression cannot be extended to include delivering the coal to a siding at the railway station. Therefore, the High Court was right in holding that these two items, namely, spare parts of motor vehicles including tyres and tubes, and motor trucks cannot be included in the registration certificate of the appellant.As far as furniture and sanitary fittings are concerned, these are covered by the ratio of the decision of this Court in the Indian Copper Corporation case ([1965] 16 S.T.C. 259). In dealing with stationery, Shah, J., observed that "stationery also is not intended for use in the manufacture or processing of goods for sale or for mining operations. Use of stationery undoubtedly facilitates the carrying on of a business of manufacturing goods or of processing goods or even mining operation but the expression intended to be used cannot be equated with likely to facilitate the conduct of the business of manufacturing or of processing goods or of mining." These observations apply to the items "furniture" and "sanitary fittings". These two items are likely to facilitate the business of mining but it cannot be said that they are intended to be used in mining.