1 M/s Jammu Iron & Steel Syndicate, Jammu, is a partnership firm engaged in the business of purchase and sale of iron and steel sheets including Galvanized iron sheets. For the accounting period from 1-4-63 to 31-12-63, the Assessing Authority assessed the firm to tax at the rate of 7% on the sales-of Galvanized iron sheets, presumably, treating them as iron goods under entry 48 of the Notification SRO No: 138 dated 28-3-1963, and also imposed a penalty of Rs. 500/-. In revision, the Commissioner Sales Tax held that the sales tax was leviable at 2% for the period from 1-4-63 to 1-8-63 and at 7% for the remaining period. He made an order accordingly. Aggrieved by order, the firm field a writ petition in this court. The writ petition came up for hearing before a learned Single Judge of this Court. By his order dated 10-4-70 the learned Single Judge remanded the case observing as under:

"The learned Commissioner seems to have been quite right in having assessed the tax at 2% for the period from 1-4-63 to 21-8-63, but as he has not applied the same stick-yard for the remaining period of the same year. I think the proper course would be that Respondent No: 1 should consider the matter afresh. I would, therefore, direct that the case be remanded to the Commissioner for its disposal according to law."

2 Acting upon this direction, the Sales Tax Commissioner reconsidered the matter and, by this order dated 28-5-75, again held that the tax was leviable at 7% for the period prior 27-8-63 to 31-12-63. Aggrieved by the order, the firm has filled a writ petition being writ petition No: 18 of 1976, and has challenged the order, In the meantime, the State too has filed an appeal, being L.P.A. No: 24 of 1970, challenging the order o the learned Single Judge. The appeal and the writ petition were heard together and will be disposed of by this common judgment.

3. Learned counsel appearing for the firm contended the G.I. sheets fall within the ambit of entry 48 of the Notification S.R.O. 138 dated 28-3-63 and are liable to sales tax at 2% advalorem. In support of his argument, he relied on the decisions in State of Andhra Pradesh Vs. Sri Durga Hardware Stores (1973 Tax L. R. 2317) and Commissioner of Sales Tax vs. Tata Iron and Steel Co. (U.P. Tax Cases 1975. Allahabad page 104)

Entry 48 in S.R.O. 138 reads thus. "48-Iron and Steel, that is to say:-

(a) pig iron, and iron scrap;

(b) Iron plates sold in the same form in which they are directly produced by the rolling mill.

(c) steel scrap, steeling nots, steel billets,, steel bars and. roads.

(d) (i) steel plates)

(ii) steel sheets) sold in the same form in

(iii) steel bars & )which they are directly tin bars produced by the rolling

(iv) rolleduced stee mill sections

(v) tool alloy steel

4. To the same effect is entry No: 2 in Schedule III to Andhra Pradesh Sales Tax Act (Act No: 6 of 1957). This entry fell for consideration by a Division Bench of the A.P. High Court in the case of Sri Durga Hardware Stores (supra). Their lordships observed:-

"The Entry No: 2 in the Schedule to the Andhra Pradesh General Sales Tax Act begins with the words "iron and steel, that is to say......". Those Words are of considerable

importance. They are explanatory of what iron and steel is. All articles enumerated under that head, either in their crude form or in their manufactured stage or in any of the forms listed under the sub-headings (a), (b), (c) and (d) are treated as various forms of iron and steel. The scope and meaning of the words that is to say following land in the Entry No: 21 of List II of the seventh Schedule to the Govt. of India Act, 1935, has been expressed by the Judicial Committee in Meghrai v. Allah Rakhia, AIR 1947 PC 72 as introducing the most general concept rights in or over land.

By a parity of reasoning, the word "that is to say occurring immediately after iron and steel in Entry No; 2 show that the Legislature intended to adopt the most general concept of iron and steel and wanted all forms of iron and steel to be brought within that entry".

and again as under :-

"Galvanization is nothing but coating the iron sheet with zinc by an electrical process, or some other process, to prevent it from oxidation. The galvanization improves the utility of the raw material of iron. Corrugation is merely wrinkling of the sheets in one direction for the purpose of making the sheets more rigid and for giving increased stiffness so as to be more suitable for roofing and walling. Corrugation results merely in the alteration of the shape of the raw material "iron and steel". Both corrugation and galvanisation improve the utility of the raw material. By the process of galvanisation and corrugation, the iron or steel do not lose their essential character as iron and steel when the resulting articles are sold as galvanised plain or corrugated sheets. The purposes for which the iron is used may be different from the purposes for which the galvanised plain or corrugated sheets are used but for that mere reason we are unable to hold that the essential character of iron has been lost .Nor is the fact that the raw material and the articles resulting on processing that are sold under different and distinct names in the commercial market, would be decisive of the fact that the galvanised plain or corrugated sheets are different from iron the raw material which still exists in them. B.P. Sheets are mere sheets of steel and hence a fortiori they are forms of iron and steel."

5 In conclusion, their lordships held that galvanized plain or corrugated sheets and B. P. Sheets fall within Entry 2 in the III Schedule to the Andhra Pradesh G. S. T. Act. This decision was followed by the Allahabad High Court in the case of M/s Tata Iron and Steel Co. (supra) and it was held that galvanization and corrugation do not change the essential character of the iron sheets, they still remain iron sheets. We are, in respectful agreement with the view expressed in these decisions and hold that the galvanized iron sheets are merely form of iron and not iron goods and fall within the ambit of Entry 48 of S .R. O No: 138 dated 28-3-1963. In this view, the sales tax leviable from the firm on the sales of galvanized iron sheets from 1-4-63 to 31-12-63 was leviable at 2% only. The view to contrary expressed by the Commissioner of Sales Tax is erroneous and must be set aside.

6 The result, therefore, is that the appeal fails and is hereby dismissed. The writ petition succeeds and is allowed. The order of the Sales Tax Commissioner dated 28-5-75 is set aside and it is directed that the firm shall be assessed to tax on the sales of G. I. Sheets at 2% for the entire accounting period from 1-4-63 to 31-12-63. Parties shall bear their own costs.