1. These three applications which raise a common question may be disposed of by a common judgment and it would be sufficient to mention the facts in Revision Application No. 347 of 1959.
2. The applicants are a partnership firm who do business under the name and style of Messrs Shah Manekchand Kundanmal & Co. The period of assessment is from 1st April, 1954, to 31st March, 1955 and in respect of this period the applicants were assessed by the Sales Tax Officer in the manner set out in his order dated 21st February, 1958. The applicants pre-ferred appeal from that order to the Assistant Collector of Sales Tax who, by his order dated 23rd February, 1959, confirmed the order made by the Sales Tax Officer. From the appellate order the applicants went in revision before the Additional Collector of Sales Tax, Bombay City Division (Revision), Bombay and that authority by his judgment dated 14th July, 1959, confirmed the order made by the Assistant Collector. It is the correctness of this order which has been questioned by Mr. Kshatri on behalf of the applicants.
3. The learned Advocate appearing for the applicants says that the ap-plicants are bullion merchants and their business is to purchase bullion from registered as well as unregistered dealers. According to Mr. Kshatri, the business done by the applicants is that in the first place they purchase bullion from both unregistered and registered dealers, then send the same to the refinery for being melted and sell the refined bullion. The Sales Tax Officer, while making the order, observed as follows: "As the majority of purchases of bullion are from unregistered dealers which is sold after mixing or melting and as the dealer could not satisfactorily prove that he mixed or melted only bullion purchased from R. dealers his claim under Rule 5(b) is rejected. No claim is also allowed under Section 8(a). He has purchased old ornaments from U. R. dealers and has sold gold after melting the same ". Therefore, the story as put forward on behalf of the applicants is not true. Their business does not seem to be merely of purchasing bullion and selling it. They also do the business of purchasing old ornaments which they appear to melt and then sell as bullion.
4. The question raised before the Additional Collector was that the applicant should be given the benefit of Rule 5(b) of the Bombay Sales Tax (Exemptions, Set-off and Composition) Rules, 1954. Rule 5 deals with classes of sales on which sales tax leviable under Section 8 is not payable and Rule 5(b) says that the sales tax leviable under Section 8 shall not be payable in respect of the following classes of sales, that is to say,- (b) sales of bullion prepared by melting, mixing or refining bullion which has been purchased by a dealer on or after the 1st April, 1954, in the pre-Reorganisation State of Bombay, excluding the transferred territories from registered dealers and to the purchase of which the provisions of Section 46 or Clause (v) of Rule 7 do not apply Therefore what is exempted under Rule 5(b) is sales of bullion as indicated in Rule 5(b). There is a proviso to Rule 5(b) which says:- Provided that nothing in this sub-rule shall apply to sales of bullion prepared by; melting any ornament or article made of gold or silver, either alone or partly with bullion.
It is clear, therefore, that to claim exemption under Rule 5(b) it must be sale of bullion only. The benefit of the provisions contained. in Rule 5(b) does not arise where the proviso applies and the proviso.applies to a sale of bullion prepared by melting any ornanient or article made of gold or silver, either alone or paytly with bullion.
5. Reference may now be made to Section 8 of the, Act of 1953 which deals with levy of sales tax and under Section 8(a) sales tax is to be, levied on the turnover of sales of goods after deducting from such tprnover sales, of goods which have been purchased from a registered, dealer on or after the appointed day. Therefore, the sales tax is leviable on the turnover of sales. of goods and from the turnover are to be deducted sales of goods which have been purchased from a registered dealer. The provisions of Section 8(a) apply provided the goods have not been processed or altered in any manner after such purchase. Therefore, the scheme appears to be this. Section 8 imposes the levy of the sales tax on the turnover of goods. From such turnover are to be deducted sales effected of goods purchased from a registered dealer. When the applicability of Rule 5(b) is to be considered the provisos of Rule 5(b) are available only where the sales are sales, of bullion prepared by melting, mixing or refining bullion. The case, is therefore, one of sale of bullion, pure and simple. When in a transaction, is introduced a sale of bullion as a result of the melting of ornaments and bullion sold afterwards the benefit of Rule 5(b) cannot be given and the proviso applies. As in this, case the finding of the authority is that the applicants make purchase of gold ornaments from customers and dealers and sell the refined bullion the case is dot covered by Rule 5(b). Apart from the provisions of Rule 5(b), no reliance has been placed upon any other provisions. The argument before the Additional Collector that the proviso to Rule 5(b) does not apply to the case of the applicants because the proviso applies only to the case of those dealers who are selling melted bullion and also manufactured ornaments was not accepted by the Additional Collector and as the Sales Tax Officer has clearly found that the business of the applicants is not one of sale of bullion, pure and simple, but that they also purchase old and gold ornaments they cannot take the advantage of the provisions contained in Rule 5(b). In the result, therefore, there is no ground to interfere. The facts in Revision Applications Nos. 348 and 349 are analogous and raise a similar question. Theiefore, in view of the conclusion set out above these applications also fail. The result is that all the three applications fail and will be dismissed.