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Reference Case No. 19 of 1966, decided on 21st December 1967.
S. 7 read with Notification No. 9, dated 27‑6‑51, Item No. 15‑Water tanks manufactured with G. I. Sheets by "manual process of hammering" -‑ Held, exempt from sales tax.
S. 17(5)‑‑Concurrent finding of fact arrived at by Appellate Assistant Commissioner and Tribunal‑Not interfered with by High Court.
A. Haque for Petitioner.
Ruhul Islam with M. R. Khan for Respondent.
Date of hearing : 21st December 1967.
‑The Income‑tax Appellate Tribunal, Dacca has referred the following question under section 17 (1) of the Sales Tax Act for our opinion:
"Whether water tanks made with galvanised iron sheets by manual process of hammering would be exempt from Sales Tax by virtue of item No. 15 of Notification No. 9, dated 27th June 1951."
The assessee is a manufacturer of water tanks made of imported galvanised iron sheets. During the relevant accounting year he disclosed a total turn over of Rs. 98,295. But he claimed that he was not liable to pay any sales tax, for, the product in question is exempt from payment of any sales tax in pursuance of a notification issued on the 27th June 1951, by the Government of Pakistan. The assessee also produced a certificate from the Director of Commerce and Industries of East Pakistan. That certificate reads as follows:‑
"Certified that M/s. Ameer Bux Metal Industries, 231/B Tejgaon Industrial Area, Dacca, which is a recognised unit in the approved list of industries under this Directorate and manufacturing G. I. water tanks requires no machinery at present for the manufacture of G. I. water tanks which they are producing by manual process."
The Director of Commerce and Industries therefore has clearly stated that no machinery was necessary for manufacturing the tanks and‑they are being produced by manual process.
The Sales Tax Officer, however, did not grant the assessee exemption as claimed by it on the ground that the expression. "Hammer products" does not mean that the application of hammer by itself will exempt the resultant production.
The appellate Assistant Commissioner, however, reached different conclusion after having witnessed the demonstration of its production before him. It appears that before the Appellate Assistant Commissioner the assessee produced a miniature water tank with loose parts for demonstration. After having witnessed the demonstration the Appellate Assistant Commissioner was convinced that the water tank as manufactured by the assessee are the outcome of hammer works.
An appeal was thereafter preferred to the Tribunal. It also reached the same conclusion. It observed:‑
"The Departmental Representative had at least to concede that hammer works' would include wire nails; nuts, tower-balls, hinges and nails. Apparently the expression "hammer work" is of wide connotation. It is not the name of any specific manufactured commodity. It must, therefore, mean products of a manufacturing process where the use of the hammer is a dominant factor."
We are ourselves in agreement with the meaning attributed to the expression "hammer works" in this case. At any rate the clear findings of the fact in this case are that these tanks were produced by hammer works. In view of the concurrent findings of fact arrived at by the Assistant Commissioner and the Appellate Tribunal, we are of the opinion that the assessee has' rightly claimed exemption under item 15 of the Notifications referred to above.
Item 15 reads as follows:‑
"Products of iron foundaries and steam and hammer works".
The question referred to us itself presupposes that the water tanks in question were made with G. I. iron sheets by a manual process of hammering and as such we are of opinion that the said tanks are exempt from sales tax as it comes within the description as given in item No. 15 of Notification 9, dated 27th June 1951, and the question is accordingly answered in the affirmative. The assessee company is entitled to its costs.
‑‑I agree.
S.Q. Reference answered in the affirmative.
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