L.N. RAY, J
The short question raised in this application under section 8 of the West Bengal Taxation Tribunal Act, 1987, is whether cast iron castings, such as, man-hole covers, certain parts of fans and top and bottom covers of ceiling fans are included in the expression "cast iron" used in section 14 (iv) (i) of the Central Sales Tax Act, 1956, having regard to the provisions of section 5 (2) (a) of the Bengal Finance (Sales Tax) Act, 1941.
2. The applicant is a registered dealer under the said 1941 Act both as a manufacturer and a reseller in respect of various goods including cast iron castings. It manufactures and sells as well as purchases and resells cast iron castings of the above descriptions. On December 4, 1987, it applied for declaration forms in form No. XXIV, but the Commercial Tax Officer rejected the prayer, holding that he was not satisfied that the items mentioned in his order and sold by the applicant were out of purchased goods included in section 5 (2) (a) (ii) of the said 1941 Act and hence he doubled the bona fide requirement of such forms. This was done, despite the fact that it was stated in the relevant column of the registration certificate that cast iron castings would be free of tax if the same were purchased for resale in West Bengal. That column was intended for declared goods under sections 14 and 15 of the Central Sales Tax Act, 1956, and section 5 (2) (a) (ii) of the said 1941 Act. The applicant claims to have purchased cast iron castings of the total value of Rs. 29,12,076. 64 during the period from July 19, 1982 to September 30, 1985, on the basis of prior orders. Apart from other declaration forms it required four forms of "e" series for the said four years. Some forms of "b" and "c" series were issued on September 30, 1982 and April 7, 1983, but thereafter no declaration form was issued. So, the applicant moved a writ petition under article 226 of the Constitution of India in Calcutta High Court, being C. O. No. 4884 (W) of 1988 in the appellate side, in which a conditional interim order was made on May 16, 1988. But the Commercial Tax Officer even then refused to issue declaration forms. The applicant then moved the Assistant Commissioner and, thereafter, the Additional Commissioner, both of them maintained the Commercial Tax Officer's order. The High Court's interim order contained a condition that declaration forms would be issued "if the same are declared goods", and the Commercial Tax Officer held the view that the goods in question were not declared goods. According to the applicant, the Government of India issued a notification dated February 28, 1977, in consultation with the Director-General of Technical Development and the Ministry of Law and Justice that "cast iron" in section 14 (iv) (i) of the Central Sales Tax Act, 1956, includes "cast iron castings".
3. The respondents have not used any affidavit-in-opposition. The records of C. O. No. 4884 (W) of 1988 have not yet been forwarded by the High Court to this Tribunal for disposal in terms of section 15 of the West Bengal Taxation Tribunal Act, 1987. The respondents have, however, contested the applicant's claim at the hearing. It may be noted that by virtue of the proviso to section 15 (2) (b) of the West Bengal Taxation Tribunal Act, 1987, the interlocutory order of the High Court dated May 16, 1988, in C. O. No. 4884 (W) of 1988 expired on May 22, 1989. But, by our interim order in this case dated July 10, 1989, direction was given to issue necessary declaration forms upon the applicant making a security deposit of Rs. 50,000 within two weeks.
4. The facts set out above are not controverted. It was submitted during arguments that only a part of the total amount of value for which declaration forms are sought for the purpose of Section 5 (2) (a) (ii) of the 1941 Act represents the value of goods which were purchased and resold, whereas the rest of the total amount represents the value of goods purchased for manufacture of such goods which were sold by the applicant. The decision in this case turns upon construction of the expression "cast iron" used in section 14 (iv) (i) of the Central Sales Tax Act, 1956. The relevant portion of the said provision is reproduced below :
It is hereby declared that the following goods are of special importance in inter-State trade or commerce :
(iv) iron and steel, that is to say, -
(i) pig iron and cast iron including ingot moulds, bottom plates, iron scrap, cast iron scrap, runner scrap, and iron skull scrap;"
5. Section 5 (2) (a) (ii) of the 1941 Act related to declared goods including iron and steel prior to April 1, 1985, from which date iron and steel were excluded from sub-clause (ii) and covered by sub-clause (vd). Since the disputed period is from July 19, 1982 to September 30, 1985, the period from April 1, 1985, will be governed by sub-clause (vd) and the period prior to that date will be governed by sub-clause (ii).
6. In the case of State of Tamil Nadu v. Pyare Lal Malhotra [1976] 37 STC 319 (SC); AIR 1976 SC 800, clause (iv) of section 14 of the Central Sales Tax Act, 1956, as redrafted in the year 1972, came up for consideration. The present sub-clause (i) of clause (iv) found place in the statute in 1972. It was held :
The more natural and normal meaning of such a mode of listing special or declared kinds of goods seems to us to be that the object of specification was to enumerate only those categories of items, each of which was to serve as a new starting point for a series of sales, which were to be classed as 'declared' goods. " It was further held :
We, however, prefer the more natural and normal interpretation which follows plainly from the fact of separate specification and numbering of each item. This means that, each item so specified forms a separate species for each series of sales although they may all belong to the genus : 'iron and steel'. Hence, if iron and steel 'plates' are melted and converted into 'wire' and then sold in the market, such wire would only be taxable once so long as it retains its identity as commercial goods belonging to the category 'wire' made of either iron or steel. The mere fact that the substance or raw material out of which it is made has also been taxed in some other form, when it was sold as a separate commercial commodity, would make no difference for purposes of the law of sales tax. The object appears to us to be to tax sales of goods of each variety and not the sale of the substance out of which they are made. "
It was also held :
" As soon as separate commercial commodities emerge or come into existence, they become separately taxable goods or entities for purposes of sales tax. Where commercial goods, without change of their identity as such goods, are merely subjected to some processing or finishing or are merely joined together, they may remain commercially the goods which cannot be taxed again, in a series of sales, so long as they retain their identity as goods of a particular type."
7. We shall be guided by the above decision of the Supreme Court in interpreting the expression "cast iron" in this case. Mr. Sasanka Sen, the learned Advocate for the applicant, relied on the clarificatory circular dated February 28, 1977 (annexure G) issued by the Department of Revenue and Banking, Government of India, in which it was clearly stated that "cast iron" mentioned in section 14 (iv) (i) of the Central Sales Tax Act, 1956, includes "cast iron castings". It was issued in consultation with the Director-General of Technical Development and the Ministry of Law and Justice. Mr. Sen also relied on a decision of the Allahabad High Court in Commissioner, Sales Tax v. Vishwa Engineering Co. reported in STI 1985 All. 233. There the Central Government's circular was adopted by the Sales Tax Commissioner of U. P. The facts were, therefore, different in that case. But on the authority of the decision in K. P. Varghese v. Income-tax Officer reported in [1981] 131 ITR 597 (SC); AIR 1981 SC 1922, this circular or notification is entitled to receive our due attention according to the rule of contemporanea expositio. Mr. D. Majumdar, the learned State Representative, submitted by reference to the case of State of Tamil Nadu v. India Metal Industries [1980] 46 STC 304 (Mad.) that the circular could at best be only advisory. In that case, however, the Central Government's circular was of a different nature. According to that circular, if an article was converted from one category of iron and steel into another, it would still fall within the genus of iron and steel and the article could not be subjected to sales tax over again. So, it was held to be at best advisory. Rightly so, because the circular tended to be interpretative. But, the circular dated February 28, 1977, is simply clarificatory as to what includes in the expression "cast iron". The Central Government administers the Central Sales Tax Act, 1956. It is, therefore, quite logical that due weight is given to the circular clarifying what was intended to be included in the expression used in the enactment. We, accordingly, hold that the expression "cast iron" used in section 14 (iv) (i) of the said Act of 1956, includes "cast iron castings". This seems also to be in conformity with the decision in [1976] 37 STC 319 (SC); AIR 1976 SC 800 (State of Tamil Nadu v. Pyare Lal Malhotra) because there seems hardly any distinction between the two expressions. According to Encyclopaedia Britannica, 1989 Edition, Micropaedia. Volume 2, "cast iron is made by reducing iron ore in a blast furnace, drawing it off in the molten state, and cooling it in the form of crude ingots called pigs" (page 930). According to Webster's New World Dictionary, "cast iron" is a "hard, unmalleable alloy of iron made by casting".
8. Thus, by applying the ratio of the decision reported in [1976] 37 STC 319 (SC); AIR 1976 SC 800 (State of Tamil Nadu v. Pyare Lal Malhotra), we hold that when the applicant purchases particular items of commodities made of cast iron castings, such as, fan parts, manhole covers and top and bottom covers of ceiling fans for resale and resells them in West Bengal in the same form, namely, without converting them into different commercial commodities, such sales cannot be taxed over again, if the same goods in the same form had suffered tax in West Bengal at an earlier stage. This is the inevitable result of sections 14 and 15 of the said Act of 1956. We further hold that where the applicant purchases "cast iron" or "cast iron castings" and out of those declared goods manufactures different commercial commodities like the abovementioned articles and sells them, such sale are liable to sales tax, even though the mother goods (out of which these were manufactured) might have already suffered sales tax. We took the same view in our judgment dated March 9, 1990, in RN-524 of 1989 (Bengal Ingot Co. Ltd. v. West Bengal Commercial Taxes Tribunal [1990] 79 STC 212) to which Mr. Majumdar for the respondents referred.
9. In view of our foregoing findings and in view of the fact that the interim order dated May 16, 1988, passed by the High Court in C. O. No. 4884 (W) of 1988 has spent its force, the applicant is not entitled to any relief as per prayer (a) in the present application. As regards issue of declaration forms, which is the real prayer of the applicant, our interim order dated July 10, 1989, should stand vacated and we should direct the appropriate Commercial Tax Officer to consider and dispose of within two weeks from this day any application for declaration forms which may be already pending with him and to do so within two weeks from the date of fresh application, if any, filed hereafter. In doing so, he should act in accordance with law and also our findings and observations in this judgment. We direct accordingly. We further direct that if the applicant has made a security deposit of Rs. 50,000 in terms of our interim order, the amount shall be adjusted against any due tax, or if there be no such tax due, the amount or such part thereof that cannot be so adjusted shall be refunded to the applicant within twelve weeks from this day. The application is, thus, finally disposed of without costs.
Application disposed of accordingly.