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Malladad and Bros. Vs. Commercial Tax Officer, Circle I, Gadag - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtKarnataka High Court
Decided On
Case NumberWrit Petition No. 21 of 1968
Judge
Reported in[1970]26STC71(Kar)
ActsMysore Sales Tax Act, 1956 - Sections 6, 6(2) and 43(3); Mysore Sales Rules, 1957 - Rule 38; Constitution of India - Article 226
AppellantMalladad and Bros.
RespondentCommercial Tax Officer, Circle I, Gadag
Appellant AdvocateK. Srinivasan, Adv.
Respondent AdvocateS.R. Rajasekhara Murthy, High Court Government Pleader
Excerpt:
.....public policy and said doctrine applies also between two stages in same litigation. - 2,000. therefore the respondent was clearly in error in levying a licence fee of rs......tax act, 1956 (hereinafter called the 'act'). but under section 6 of the act the dealers were liable to pay licence fee computed on the total turnover of the dealer in respect of each place of his business and such fee was leviable as if it were a tax or any addition thereto. the matter relates to the accounting period from 9th november, 1961, to 28th october, 1962. 2. section 6 of the act, as it originally stood, provided for levy of licence fee at the rate of rs. 1.50 per thousand subject to a maximum of rs. 2,000 per annum. section 6 was amended by mysore act no. 30 of 1962 and the amendment came into force on 1st october, 1962. as a result of the amendment the licence fee leviable under section 6(2) of the act was enhanced from rs. 1.50 to 5 per thousand subject to a maximum of.....
Judgment:
ORDER

Govinda Bhat, J.

1. This writ petition preferred under article 226 of the Constitution of India is directed against the order passed by the Commercial Tax Officer, 1st Circle, Gadag, (respondent) on 7th June, 1967, under rule 38 of the Mysore Sales Rules, 1957. The petitioner is a dealer carrying on business in cereals. Sale of cereals was not chargeable to sales tax under the Mysore Sales Tax Act, 1956 (hereinafter called the 'Act'). But under section 6 of the Act the dealers were liable to pay licence fee computed on the total turnover of the dealer in respect of each place of his business and such fee was leviable as if it were a tax or any addition thereto. The matter relates to the accounting period from 9th November, 1961, to 28th October, 1962.

2. Section 6 of the Act, as it originally stood, provided for levy of licence fee at the rate of Rs. 1.50 per thousand subject to a maximum of Rs. 2,000 per annum. Section 6 was amended by Mysore Act No. 30 of 1962 and the amendment came into force on 1st October, 1962. As a result of the amendment the licence fee leviable under section 6(2) of the Act was enhanced from Rs. 1.50 to 5 per thousand subject to a maximum of Rs. 8,000. Section 6 of the amending Act added sub-section (3) to section 43 of the Act. The said sub-section (3) reads thus :

'(3) Notwithstanding anything contained in this Act, where in respect of the sale or purchase of any goods, the rate of tax (hereinafter referred to as the original rate) is revised, or no tax is payable, from any date during any year, the turnover of a dealer or other person during the period up to that date in that year shall be liable to tax at the original rate, and his turnover during the period from that date till the end of that year shall be liable to tax at the revised rate, or shall not be liable to tax, as the case may be.'

3. In view of sub-section (3) of section 43 introduced by the amending Act, licence fee which is levied as if it were a tax was chargeable up to 1st October, 1962, at the rate provided in sub-section (2) of section 6 as it stood before the amendment, and in respect of the turnover for the period subsequent to 1st October, 1962, till 28th October, 1962 the licence fee was chargeable at the rate provided under the amending Act. The petitioner's turnover for the period commencing from 9th November, 1961, to 30th September, 1962, was Rs. 19,82,806.69. The licence fee computed at Rs. 1.50 per thousand works out to Rs. 2,974.50. His turnover for the period from 1st October, 1962, till 28th October, 1962, was Rs. 1,28,211.16. The licence fee on the said turnover of Rs. 1,28,211.16 works out at Rs. 645. The petitioner does not dispute that the licence fee of Rs. 645 is chargeable on the turnover for the period subsequent to 1st October, 1962. His contention is that he was not liable to pay licence fee exceeding Rs. 2,000 for his turnover for the period up to 30th September, 1962. The respondent on the view that maximum licence fee provided under sub-section (2) of section 6 as it originally stood was not applicable after the amending Act came into force, charged licence fee of Rs. 2,974.50. Section 6 of the amending Act adding sub-section (3) of section 43 of the Act makes it clear that up to the date of amendment, tax is chargeable only at the rate in force under the law as it stood before the amendment. That law provides a maximum licence fee of Rs. 2,000. Therefore the respondent was clearly in error in levying a licence fee of Rs. 2,974.50 instead of Rs. 2,000. In that view, this writ petition succeeds and the impugned order marked exhibit 3 dated 7th June, 1967, is quashed. No costs.

4. Petition allowed.


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