1. This revision petition is directed against the order dated July 14, 1981 of the Karnataka Appellate Tribunal, Bangalore, passed in S.T.A. No. 1078 of 1979.
2. The assessee is a dealer in empty bottles and tins. For the assessment year 1977-78 the assessing authority has determined the total and taxable turnovers at Rs. 2,60,015.60 and Rs. 2,25,950.00 as against the declared total and taxable turnover of Rs. 2,21,567.82 and Rs. 2,09,552.22 respectively. The assessing authority also added 20 per cent. as gross profits on the purchases of bottles and tins made by the assessee.
3. On appeal, the Deputy Commissioner of Commercial Taxes (Appeals), Bangalore City Division, confirmed the assessment and dismissed the assessee's appeal. Further appeal of the assessee before the Tribunal also failed. The Tribunal has upheld the assessment holding the assessee as a first dealer and not entitled to claim exemption from tax since he was not able to produce any evidence to show that the old empty bottles were purchased from local registered dealers on payment of tax and did not produce the declaration as required under rule 26(9)(a) of the Karnataka Sales Tax Rules, 1957. The Tribunal also upheld the addition of 20 per cent. gross profits on the purchases in the absence of opening and closing stock figures, the trading account, and profit and loss account.
4. Before us, Sri G. V. Ramaiah, learned counsel for the assessee, contended that the assessee was not the first dealer in the State in respect of the bottles, since he had purchased the old and used bottles, the first sale of which must have suffered tax. According to the learned counsel, the fact that the bottled purchased by the assessee were admittedly old and used bottled, itself is a sufficient indicating that the sale to the assessee was not exigible to tax.
5. Item No. 109 of the Second Schedule to the Karnataka Sales Tax Act reads : 'Glassware and glass bottles.' Section 5(3) of the K.S.T. Act provides for levy of tax on the sale of goods mentioned in column (2) of the Second Schedule by the first or the earliest of successive dealers in the State at the rate specified in the Second Schedule on the taxable turnover of the sale of such dealer in each year relating to such goods. The dominant intention of the said charging section is to impose levy of single point tax on the first stage of the sale of the goods specified in the Second Schedule and as such it is implicit that subsequent sales are not exigible to tax under the Act; provided, such dealers effecting such subsequent sales furnish necessary proof that the earliest of the successive dealer was liable to pay tax in the State.
6. Sri Rajendra Babu, learned High Court Government Advocate, contended that there is no evidence to prove the fact that the bottles which are containers of various products, have also been sold ultimately to the consumers and as such it cannot be inferred or assumed that the said bottles suffered sales tax. He has placed reliance upon rule 26(9)(a) of the Rules, which provides that every dealer in goods taxable at the point of first sale in the State, shall, where he claims exemption from payment of tax by reason of his not being the first seller, furnish to the assessing authority a declaration in form 32 obtained from the unregistered dealer who sold the goods to him. He contended that under these said rule, it was incumbent upon the assessee to prove that the second hand bottles in which he was dealing were liable for payment of tax in the hands of the first or earliest dealer of the bottles.
7. In the instant case the following facts are admitted or proved. That the assessee purchased empty bottles from hawkers, who are unregistered dealer and who had collected the same from consumers or otherwise, and (2) that the bottles were second hand once which had earlier been sold to customers by the earlier dealers or the manufactures with the contents thereof.
8. In State of Orissa v. M. A. Tulloch and Co. : 7SCR816 the Supreme Court observed that the production of declaration under rule 27(2) of the Orissa Sales Tax Rules is not obligatory on the part of the seller when claiming the exemption and that the rule should be treated as directory.
9. In Sri Lakshminarayana General Traders v. Commercial Tax Officer  36 STC 402 the Andhra Pradesh High Court, while interpreting rule 45(3)(b) of the Andhra Pradesh General Sales Tax Rules, 1957 observed that the proof of the fact that the sale is a second sale may be established by adducing oral or documentary evidence and a mere failure or omission on the part of the assessee to produce the certificate referred would not ipso facto entitle the assessing authority to include such turnover in assessment to levy tax thereon.
10. In both the abovesaid cases the rule that came up for consideration was similar to rule 26(9) of the Rules framed under the Karnataka Sales Tax Act.
11. In the light of these principles, the question that arises for determination is whether the turnover of the empty second hand bottles is assessable to sales tax under the K.S.T. Act and whether the assessee has discharged the burden to show that his sale was a second sale.
12. In our opinion, the facts proved in the case speak for themselves. The very fact that the bottles in question are second hand bottles will suggest that there was an earlier sale of the same bottles liable to tax. It might be as containers or otherwise. There is no presumption that the bottles when used as containers are not the subject-matter of sale. Generally, though not always, when there is a sale of an article, the container and the contents are both sold and the purchasers pay one consolidated price and the price of the containers is usually included in that sale price.
13. It seems to us, therefore, that the Tribunal was not right in holding that the petitioner having purchased the bottles from unregistered dealers had become the first dealer liable to pay tax. The fact that they were second hand bottles itself is sufficient to hold that there was an earlier sale of the same bottles liable to tax.
14. In the result the revision petition is allowed. The assessment as confirmed by the appellate authorities is set aside. The tax, if any, collected from the assessee, shall be refunded.
15. In the circumstances there will be no order as to costs.