M. S. Menon, J.
1. The petitioner claims exemption from sales tax in repect of the French Polish manufactured by the petitioner, under section 4 of the Madras General Sales Tax Act, 1939. The assessment year with which I am concerned is 1955-56, and the turnover in controversy amounts to Rs. 90,907-5-3.
2. Section 4 of the Madras General Sales Tax Act, 1939, provides (inter alia) that the provisions of that Act shall not apply to 'any goods on which duty is or may be levied' under the Madras Prohibition Act, 1937, and the contention of the petitioner is that French Polish comes within the category of goods on which duty is levied under the Madras Prohibition Act, 1937.
3. The Commercial Tax Officer dealt with the petitioner's contention as follows :--
The contention of the appellant is not tenable for the simple reason that the gallonage fee is paid only on the denatured spirit used and the manufactured product of French Polish is altogether a different commodity from the denatured spirit. The manufacturer of French Polish is therefore liable to pay sales tax on his sales irrespective of the fact that he has paid the gallonage fee on the denatured spirit used for its manufacture (Exhibit P-2).
4. French Polish is essentially a solution of resin in alcohol and it is not disputed by the department that denatured spirit enters largely into its manufacture by the petitioner. It is equally true that a gallonage fee is payable on denatured spirit. Section 18 of the Madras Prohibition Act, 1937, provides :--
The Provincial Government or subject to the control of the Provincial Government the Collector may issue licences to any person or in respect of any institution whether under the management of Government or not, for the manufacture, export, import, transport, sale or possession of any liquor, intoxicating drug or article containing such liquor or drug, on the ground that such liquor, drug or article is required by such person or in respect of such institution for a bona fide medicinal, scientific, industrial or such like purpose and Clause 6 of Form D-1--licence for possession and use of denatured spirit-- A licence fee at the rate of 12 annas per imperial gallon of denatured spirit shall be levied on the quantity actually used by the licensee in each quarter.
These are the only provisions on which counsel for the petitioner relies in support of the contention.
5. I am not prepared to say that a gallonage fee on denatured spirit used in the manufacture of French Polish will amount to a levy of a duty on French Polish under the Madras Prohibition Act, 1937, and it follows that section 4 of the Madras General Sales Tax Act, 1939, cannot exonerate the petitioner from liability under that Act.
6. The petition fails and is hereby dismissed. No costs.