High Court of Judicature at Allahabad
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The Commissioner Trade Tax,U.P.Lucknow v. S/S S.R.Paper Cones,Railway Road Hapur - SALES/TRADE TAX REVISION No. 918 of 1996  RD-AH 1340 (5 November 2004)
Court no. 55
Trade Tax Revision no. 918 of 1996.
Trade Tax Revision no. 919 of 1996.
Commissioner of Trade Tax, U. P. Lucknow. ... Revisionist.
S/S R. R. Paper Canes, Hapur. ... Respondent.
Hon'ble Rajes Kumar, J.
These two revisions under Section 11 of U. P. Trade Tax Act (hereinafter referred to as ''Act') are directed against the order of Tribunal dated 20.2.1996 relating to assessment years 1985-86 under the U. P. Trade Tax Act as well as under the Central Sales Tax Act respectively.
Dealer opp.party established a new Unit for manufacturing and sale of Paper Cones and packing materials. It was a partnership Firm. During the course of assessment proceeding, Assessing Authority found that Paper Cones worth of Rs.5,67,892/- was sold to the customers after getting them manufactured by sister concern Firm namely M/S Sandeep Cones, to whom a sum of Rs.1,53,620/- was paid towards the manufacturing charges out of total manufacturing expenses at Rs.5,67,982/-. Sales of Paper Cones at Rs.97,400/- was made within the state of U. P. and sales for Rs.4,70,582 was made outside the State of U. P. On the aforesaid amount, Assessing Authority refused to grant exemption under Section 4-A on the ground that the said Paper Cones were not manufactured by the opp. party but were manufactured by the sister concern Firm M/S Sandeep Cones. The main ground for taking the aforesaid view was that out of total expenses of Rs.1,57,545/- which was shown towards manufacturing expenses, a sum of Rs.1,53,620.40p. was paid to M/S Sandeep Cones, therefore, it was inferred that the entire manufacturing of Paper Cones were being carried on by M/S Sandeep Cones. Order of Assessing Authority was up held by the FirstAppellate Authority. Tribunal allowed the appeal and deleted lthe tax levied both under the U. P. Trade Tax Act as well as under the Central Sales Tax Act.
Heard Counsel for the parties.
Before the Tribunal, dealer opp. party contended that the manufacturing of Paper Cones involved various process namely punching of paper, grinding of papers, embossing of papers and winding of papers and only winding of paper were being got done on job work basis from of M/S Sandeep Cones, for which a sum of Rs.1,53,620.40p. was paid. Dealer opp. party further contended that it was wrong to say that the total expenses towards the manufacturing was debited at Rs.1,57,545 and according to the dealer, a sum of Rs.1,53,620.40p. paid to M/S Sandeep Cones for job work was separate to the manufacturing expenses incurred by the opp. party at Rs.1,57,545/- for various manufacturing process. Tribunal has accepted the plea of opp.party. Tribunal held that a sum of Rs.1,53,620.40p. paid to M/S Sandeep Cones for job work, was not out of manufacturing expenses amounting to Rs.1,57,545/- and it was a separate amount debited in the books of account. Finding of Tribunal is the finding of fact. Learned Standing Counsel is not able to show that this finding recorded by the Tribunal is wrong. Tribunal further held that out of various process involved in the manufacturing of paper cones, only winding process was being got done on job work basis from M/S Sandeep Cones and rest of the manufacturing processes were being carried on by the dealer. This finding of Tribunal is finding of fact against which, no material has been placed. In view of the said finding, I do not find any error in the order of Tribunal in deleting the tax levied on the turnover of Paper Cones, treating them manufactured by opp. party dealer.
In the result, both the revisions fail and are dismissed.
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