1. The two points that arise for consideration in these two cases are:
(1) Whether the transactions carried on by the petitioners would amount to sale of batteries attracting liability to sales tax ; and (2) what is the rate of tax to be charged on the transactions, if they are treated as taxable sales
2. The petitioners have supplied batteries to various customers and their contention was that they merely reconditioned the batteries of their customers by replacing the worn-out parts like plates, separators, etc., and recharged them for use and that such reconditioning of the said batteries and supplying of the same to their customers in a working condition amounts to a works contract and, as such, the transactions are not liable to be taxed as sales.
3. With reference to the petitioners' contention that they merely reconditioned the old batteries supplied by the customers, the assessing authority found as a fact that there was no proof to show that the customers gave the worn-out batteries to the petitioners for reconditioning and that no records, like order book, etc., have been maintained by them in this behalf. The assessing authority also found that having regard to the value of Rs. 100 to Rs. 150 charged for the batteries supplied by the petitioners it is not probable that the old batteries of the customers would have been reconditioned, that the petitioners themselves should have purchased the old batteries and after reconditioning them, sold the same to the various customers as a finished product for a specified price ranging from Rs. 100 to Rs. 150 and that, therefore, they are liable to be taxed as regular sales effected by the petitioners.
4. The Appellate Assistant Commissioner also agreed with the view of the assessing authority.
5. On a further appeal to the Sales Tax Appellate Tribunal, it also found that the petitioners have not shown to have reconditioned the batteries supplied by the customers and that the facts clearly indicated that, the petitioners were purchasing old batteries and other parts like plates, separators, etc., and after rebuilding such batteries, sold them as finished products to various customers. On the said factual finding that the old batteries were not supplied by the customers, the Tribunal was of the view that the sale of reconditioned or rebuilt batteries by the petitioners to the various customers amounted to sale of batteries and, therefore, they have rightly been taxed.
6. Before us the learned counsel questions the findings of the authorities below that the old batteries have not been shown to have been supplied by the customers. But we are of the view that all the authorities below have concurrently found that the petitioners have not produced any material to show that the old batteries were supplied by the customers. It is not, therefore, possible to accept the case put forward by the petitioners that they merely reconditioned the batteries belonging to the customers and, therefore, they were merely works contracts. On the facts found by the authorities below, we are of the view that no other conclusion is possible. If the petitioners have purchased old batteries and sold them as reconditioned to the customers, it will definitely amount to sale of goods. We are of opinion that the Tribunal has come to the right conclusion on this aspect of the case.
7. Then as regards the rate of tax to be charged in respect of the sales of batteries, it is the contention of the petitioners that batteries will fall under item 41 dealing with 'electrical goods' and will not fall under item 3, as it stood then, dealing with motor vehicles and their accessories. In this case the authorities below have proceeded on the basis that batteries will fall under item 3 in Schedule 1.
8. The learned counsel for the petitioners contends that, item 3 of Schedule I will take in only such of those articles which can be adapted for use generally as parts and accessories of motor vehicles and it will not include 'battery' which does not need any adaptation for use as part of a motor vehicle. Bat, we are of the view that the 'batteries' having been specifically referred to in item 3 of Schedule I, it is not possible to exclude the battery merely on the ground that it is not an article which requires any further adaptation for use as part of a motor vehicle. The contention of the learned counsel for the petitioners that 'battery' will fall within item 41 of Schedule I dealing with electrical goods is not. acceptable, for the reason that the said item dealing with electrical goods does not refer to batteries as part of electrical goods, appliances or accessories. Even though a battery can be used for production of energy, it cannot be brought under that item, for the 'battery' has been specifically brought under item 3 of Schedule I as part and accessory of motor vehicles.
9. We are, therefore, of the view that the batteries have been rightly taxed under item 3 of Schedule I in this case.
10. The tax cases are, therefore, dismissed with costs. Counsel's fee Rs. 150 in each case.