1. This revision application has been preferred from an order made by the Additional Collector of Sales Tax, Bombay City Division (Revision), Bombay, on the 27th of April, 1959. The facts of the case are not seriously in dispute. The applicants purchased a certain quantity of unshelled groundnuts during the period commencing on 1st November, 1952 and ending on 31st March, 1954. In respect of this purchase the Sales Tax Authorities recovered a tax which is now the subject-matter of controversy between the parties. For the period commencing on 1st April, 1954 and ending on 31st March, 1955, the Sales Tax Authorities assessed the applicants to a tax of Rs. 63,099-10-6. It is the contention of the applicants that in respect of this amount they are entitled to a set-off in respect of the tax already paid by them for the period from 1st November, 1952, to 31st March, 1954. The authorities below did not accept the contention of the applicants and the point taken on behalf of the applicants in this application by the applicants' learned Advocate is that the authorities below were wrong in not allowing the applicants the refund as claimed by them.
2. Now, it is not in dispute that what the applicants purchased was unshelled groundnuts. It is not again in dispute that a tax was recovered by the Sales Tax Authorities upon the purchases made by the applicants during that period. What happened was that on the 1st of April, 1954, the stock in the hands of the applicants was not in respect of the unshelled groundnuts but was in respect of the seeds, that is to say, after removal of the shells of the groundnuts. The contention on behalf of the State, therefore, is that for the period commencing 1st April, 1954 and ending on 31st March, 1955, what was in the stock of the applicants was the seeds and not the unshelled groundnuts and it is, therefore, contended that the applicants are not entitled to a set-off or a refund. Now, it is true that the unshelled groundnuts and seeds are two different things. In order to make a groundnut a seed one has to remove the shell within which there is a seed. It would appear that some sort of process is necessary in, order to remove the shell to make it a seed, but it would appear that Rule 11(3)(b)of the Bombay Sales Tax (Exemptions, Set-off and Composition) Rules, 1954, refers to entries 1 to 18, both inclusive, of Schedule B and when one turns to Schedule B to the Act of 1953, entry No. 5 refers to oil seeds. Now, a reference to entries 1 to 18 shows that the only reference made is to oil seeds and no reference is made whatever to groundnuts. Mr. Rao has fairly conceded that what was recovered from the applicants for the period from 1st November, 1952, to 31st March, 1954, was a tax in respect of the oil seeds. It is, therefore, now futile to contend that the applicants are not entitled to a refund on the same Article which prior to 1st April, 1954, was unshelled groundnuts and which on 1st April, 1954, was oil seeds. Apparently, the Legislature has made no distinction between unshelled groundnuts and oil seeds, as is clearly apparent from entry 5 in Schedule B to the Act. Apart from anything else, therefore, the applicants are, in equity, entitled to a refund of the amount as much as the Sales Tax Authorities have already recovered from the applicants as tax for the period between the 1st of November, 1952 and 31st of March, 1954.
Moreover, the point which has now arisen for consideration in this application has been covered by a decision of this Tribunal given on the 28th May, 1959, in Premji Bhanji & Co. v. The State of Bombay (Revision Application No. 81 of 1956). As in that case; so also in the present case the stocks were originally in respect of the unshelled groundnuts and the stock afterwards took the form of seeds. There was a process decortication and yet this Tribunal held that the applicants in that case were entitled to a refund. This Tribunal was considering the scope and effect of Rule 11(3)(b) of the Bombay Sales Tax (Exemptions, Set-off and Composition) Rules, 1954 and the same question has arisen in this case. The relevant entry which was the subject of construction in the case was entry 5 which related to oil seeds and that very entry is the subject of argument in this case. In these circumstances, it is difficult to see how the contention raised on behalf of the State is well-founded. It may be that in the popular acceptation of the expressions unshelled groundnuts and seeds are two different things. It may be that in order to convert a groundnut into a seed one has to remove the shell from the seed. It may be that this involves a process of separation. Lven so, the fact remains that the Legislature has made no distinction between unshelled groundnuts and seeds, as is clearly apparent from entry 5 in Schedule B to the Act. If it is so, the applicants are right in saying that they are entitled to a refund or a set-off in respect of the amount which they have already paid by way of a tax for the period between the 1st of November, 1952 and 31st of March, 1954. Following the decision of this Tribunal in Revision Application No. 81 of 1956, therefore, we allow the present application and modify the orders made by the authorities below and direct that the assessment order made by the Sales Tax Officer, II Division, Licence Circle, Bombay, will be amended by providing that the applicants will be entitled to have a refund of the amount of a tax paid by them in respect of the period between 1st November, 1952 and 31st March, 1954, in respect of the groundnuts of the total amount of Rs. 5,50,847. Mr.
Patel points out that the amount of tax to which he is entitled by way of a refund is a sum of Rs. 4,232-13-6. As the amount has not been precisely determined, the Sales Tax Officer will determine that amount and amend the assessment order accordingly. In the circumstances of this case there will be no order as to costs.