Full Judgment
J.K. Mohanty, J.
1. These are references under Section 24(1) of the Orissa Sales Tax 'Act, 1947 (hereinafter called the Act) on the instance of the assessee. The following questions of law have been referred to this court for opinion.
(i) Whether on the facts and in the circumstances of the case the learned Member, Addl. Sales Tax Tribunal was justified in holding that stone-ware-pipes and fittings, which were admittedly not sanitary fittings, are covered under serial 7-B of the Schedule of Taxable Goods appended to the G. S. T. Act ?
(ii) Whether on the facts and in the circumstances of the case the learned Member, Addl. Sales Tax Tribunal was justified in holding that initiation of proceeding under Section 12(8) of the Act was proper ?
(iii) Whether on the facts and in the circumstances of the case the Member, Addl. Sales Tax Tribunal was justified in holding that the re-assessment, proceedings were not barred by limitation?
During hearing only point No. 1 was argued before us and the other points were not agitated.
2. The material facts leading to these references briefly stated are as follows-
The assesses, Orissa Ceramic Industries, Jharsuguda, manufacturers stone-ware pipes and fittings and fire clay bricks. The Assessing Officer originally treated, these items as unclassified goods and assessed tax at the rate of 5% in a proceeding u/s 12 (4) of the Act for the years 1972-73 and 1973-74; Subsequently on receipt of audit report, a proceeding under Section 12 (8)'of the Act was initiated and tax at the rate of 7% for 1972-73 and 8% from 1.7.73 till 31.3.74 was assessed. Penalty was also imposed by the Assessing Officer. In the first appeal, the Assistant Commissioner accepted the finding of the Assessing Officer regarding the stone-ware-pipes ,and fittings. However, he annulled the imposition of penalty. A second appeal was carried to the Tribunal. The Tribunal also accepted the finding of the lower appellate court., On the application of the assessee, these references were made to this Court.
3. The main contention of Mr. Pasayat, learned counsel appearing for the petitioner, is that stone-ware-pipes cannot be included ' in the entry bearing serial No. 7-B of the Schedule of Taxable Goods of the Act. He further argued that stone-ware-pipes and fittings cannot be covered by the words, all types of pipes and pipe fittings' as per the aforesaid SI. No. 67-B and they are to be taxed accordingly. According to him, 'all types of pipes and 'pipe fittings' will mean those pipes and pipe fittings which are used for sanitary purpose. The words 'all types of pipes and 'pipe fittings' in entry No. 7-B are undoubtedly capable of a wide meaning so as to cover all types of pipes, irrespective of the question of the use for which they are designed. It must, however, be noted that the category of goods in entry No. 7-B is not described as 'all types of pipes and pipe fittings', but as 'all types of sanitary wares and fittings and all types of pipes and 'pipe fitting'. The words 'all types of pipes and pipe fitting' must, therefore receive colour from the words associated with them. In support of his contention 'he cited a decision reported in (1980) 46 S. T. C. 473 (Commissioner of Sales Tax., M. P. v. Truel Tubes). He also placed reliance'' on two other decisions reported in (1972.) 29 S. T. C. 4.8/7, Indian Hume Pipe Company Ltd. v. The State of Uttar Pradesh and Ors. and (1973) 32 S. T. C. 95 (The Indian Iron and Steel Co. Ltd. v. Sales Tax Officer, Sector 4, Kanpur and Anr.). In the decision reported in (1980) 46 S.T.C 473 the words used in the concerned entry were identical to those used in entry 7-B. It was held that the words' 'all' types and of pipes and pipe fittings' must be construed as embracing pipes used, for sanitary purpose.
4. On a perusal of the order, passed by the Tribunal in Second Appeal Nos. 498-499 of 1977-78 we find that 'the Tribunal has proceeded on the footing that all types of pipes and pipe fitting are covered under the entry in SI. No. 7-B. It has not come to a definite finding whether stone- were-pipes which ware sold by the assessee, were used for sanitary 'purpose'. According to the learned counsel the grounds taken by him before 'the Sales' Tax Officer, 'appellant court' and the Tribunal were 'that' stone-ware-pipes sold, by the 'assessee, are used for purposes other than Sanitary purpose. As, the Tribunal proceeded oh the footing that all types of. pipes and pipe fittings are covered under the entry in SI. No. 7-B, it did not apply its mind to this aspect of the case and did not come to a specific finding as to whether stone-ware-pipes sold by the assessee are used for sanitary purpose. So, question No. 1 is answered in the following manner-
If the stone-ware-pipes, manufactured by the assessee, are used for sanitary purpose, in that event only entry in SI. No. 7-B shall be attracted. The Tribunal will consider the materials produced before it and after re-hearing the parties come to a definite conclusion whether stone-ware-pipes manufactured by the assessee are used for sanitary purpose.
5. The reference is answered accordingly.