Commissioner, Trade Tax vs Rathi Ispat Ltd.

Prakash Krishna, J.—This revision is directed against the order dated August 18, 1995 passed by the Trade Tax Tribunal, Bench II,

Ghaziabad, in Second Appeal No. 29 of 1995 for the assessment year 1987-88.

The assessee opposite party is a recognition certificate holder and was authorised to purchase raw material u/s 4B of the U.P. Trade Tax Act,

1948. The penalty proceedings u/s 4-B(5) of the Act were initiated by the department on the plea that the dealer after making purchases on

concessional rate against form III-B got the goods manufactured by other agency on job-work basis. The Assessing Officer imposed penalty by

the order dated February 21, 1994, which was confirmed in appeal by the Deputy Commissioner (Appeals). The Tribunal by the order under

revision has set aside the penalty order.

Heard Sri Bipin Kumar Pandey, learned Standing Counsel for the Department and Sri Piyush Agarwal for the opposite party.

It was contended on behalf of the department that from the language of section 4-B(5) it is clear that the raw material should be used in the

manufacture of notified goods by the assessee himself. Reliance was placed on section 4-B(2) of the Act which is quoted below :

(1) .....................................

(2) Where a dealer requires any goods, referred to in subsection (1) for use in the manufacture by him, in the State of any notified goods, or in the

packing of such notified goods manufactured or processed by him, and such notified goods are intended to be sold by him in the State or in the

course of inter-State trade or commerce or in the course of export out of India, he may apply to the assessing authority in such form and manner

and within such period as may be prescribed, for the grant of recognition certificate in respect thereof ; and if the applicant satisfies such

requirements and conditions as may be prescribed, the assessing authority shall grant to him in respect of such goods a recognition certificate in

such form, and subject to such conditions, as may be prescribed.

.....................................

It was submitted that by the phrase ""by him"" shall mean the assessee himself. I am unable to agree with the aforesaid submission. The work got

done on job-work by an assessee is the work for the assessee. It is wholly immaterial whether the raw material is consumed by the assessee for

himself or he gets the goods manufactured from the agency of other person on job-work. The assessee utilises the raw material in the manufacture

of notified goods. In the eyes of law the assessee got the notified goods manufactured even on job work basis. Counsel for the assessee brought to

my notice a circular issued by the principal Secretary, U.P. Sasahan, dated February 5, 2001, addressed to the Commissioner of Trade Tax, U.P.,

Lucknow. In the said circular it has been provided that u/s 4-B(2) of the Act such a dealer shall also be covered who got the notified goods

manufactured on job-work.

In view of above, I find no merit in the revision. It is, accordingly, dismissed.