(1) The petitioner is a firm of dealers carrying oil business in 'pump sets' machinery at Madras. They were assessed by the joint Commercial Tax Officer, Harbour I, on the net turnover of Rs. 1,02,377, under the Central Sales Tax Act, for the year 1959-60. Of this turnover, Rs. 62,342 held liable to tax at the rate of 1 per cent. and Rs. 40,035 to tax at the rate of seven per cent. They preferred in appeal before the Appellate Assistant Commissioner of Commercial taxes, Madras, claiming that of the turnover of Rs. 40,035, Rs. 34,215 should be taxed only at the rate of one per cent. The joint Commercial tax Officer had levied the tax at the rate of seven per cent as the petitioner did not file the original form 'C' as required by the Act, and the rules framed thereunder in respect of a few transactions, and as the C forms filled in respect of a few transactions were net duly and properly filled up. The petitioner produced certain letters before the Appellate authority alleged to have been written from non-resident buyers outside the State to whom goods were sold but the appellate authority declined to act upon them. The petitioner's appeal was dismissed. They filed a further appeal before the Sales-tax Appellate Tribunal, Madras, and they reiterated their, claim that the turnover relating to the stun of Rs. 34215 Should Suffer tax only at the rate of one per cent. The Tribunal noted a mistake in regard to one transaction in respect of which the actual turnover was only Rs. 1640 though the petitioner claimed it to be for a sum of Rs. 16-50. The Tribunal acted upon the evidence produced by the Petitioner and took the view that the claim for the levy of tax at concessional rate was irresistible. The peti66ner was therefore granted relief on a turnover of Rs. 34205 which was to he assessed at one per cent instead of seven per cent. This revision petition has beer preferred by the State challenging the correctness of the said order of the Tribunal.
(2) The following tabular statement extracted from the order of the Tribunal gives the particular of the turnover and the reason for taxation at the enhanced rate of seven per cent.
Invoice No. & date Turnover Reason for taxing at enhanced rate 1. 1545 d/- 3-4-59 Rs. 1650 No. C. form filed 2. 1549 d/- 21-4-95 Rs. 1440 do 3. 1553 d/- 4-6-95 Rs. 7750 Purpose not marked 4. 1565 d/- 6-9-95 Rs. 350 Date of Registration not marked 5. 1568 d/- 10-11-59 Rs. 1000 Purpose not marked 6. 1569 d/- 18-11-59 Rs. 400 Purpose not marked and registration date not found. 7. 1574 d/- 3-2-60 Rs. 6750 Purpose not marked 8. 1575 d/- 12-2-60 Rs. 7000 Purpose not marked 9. 1577 d/- 17-3-60 Rs. 7000 Purpose not marked 10. 1578 d/- 18-3-60 Rs. 875 do do
(3) In regard to S. Nos. 1 and 2, the petitioner diet not file the prescribed C form before the assessing authority. It is alleged on their behalf that the C forms were misplaced and could not be traced in time to enable them to file them before the assessing authority at the proper time. In respect of S. No. 2 the original C form does not contain the date of registration of the buyer. The duplicate C form however shows that the date of registration was 18-7-1959, though the sale was effected on 21-4-1959. The concessional rate of taxation at the rate of one per cent, is provided for under S. 8(1) of the Central Sales-tax Act. S. 8(4) of the Act provides. that S. 8, sub-sec. (1) shall not apply to any sale in the course of inter-State trade or commerce unless the dealer selling the goods furnishes to the prescribed authority in the prescribed manner a declaration duly filled and signed by the registered dealer, to whom the goods are sold containing the prescribed particulars in a prescribed form obtained from the prescribed authority. The prescribed form is bite form C under the Central-Sales-tax (Registration and Turnover) Rules.
Rule 10 of the Central Sales-tax (Madras) Rules. 1957, provides that every registered dealer who wishes to purchase goods from another such dealer on payment of tax at the rate applicable under the Act to sales of goods by one registered dealer to another, shall obtain from the assessing authority blank declaration forms prescribed (C forms) for furnishing it to the selling dealer. Before furnishing the declaration to the selling dealer the purchasing dealer or any responsible person authorised by him in this behalf shall fill in all the required particulars in the form, and shall also affix his usual signature in the space provided for in the form for this purpose. Rule 5 of the Central Sale-tax (Madras) Rules provides that every dealer registered under S. 7 of the Act shall submit a return of his transactions in the course of interstate trade or commerce in form No. 1, together with the connected declaration form (C form) so as to reach the assessing authority on or before the 25th of each month showing turnover for the preceding month, and the amount or amounts collected by way of tax together with a chalan or crossed cheque in favour of the assessing authority for the payment of the tax due thereon under the Act.
Rule 10(2) provides that a registered dealer who claims to have made a site to another registered dealer shall in respect of such claim attach to his return in form No. 1, the portion marked 'original' of the declaration received by him from the purchasing dealer (C form). The Selling dealer way instead of attaching the form of declaration to the return in form I keep it in his custody subject to the condition that he maintains a register in form IX showing serially and chronologically the receipt at the forms of declaration from they purchasing dealers and submit all the forms of declaration relating to the year along with the last return in form I due for that year. The benefit of one per cent. under S. 8(1) of the Act is conditional upon the assessee producing and furnishing the prescribed declarations form, in the prescribed manner. The language, of S. 8(4) is express, explicit and mandatory as the words used are
'the provisions of sub-sec. (1) shall not apply to any sale.......... unless tile dealer selling the goods furnishes to the prescribed authority in the prescribed manner a declaration duly filled and signed by the registered dealer.'
There is no scope, in view of the specific rules already referred to for the assessee to claim the benefit of S. 8(1) of the Act by producing the C forms before the, appellate authority after an assessment older against him. The Act does not confer any power upon the appellate authority to receive C forms produced before him for the filet time by the assessee by condoning the failure on the part of the assessee to produce them before the assessing authority. Non-observance or the rules by the assessee in the matter of production of the C forms will inevitably deprive the assessee of the benefit of favourable taxation under S. 8(1) of the Act. We have already taken his view in our decision in T. C. No. 89 of 1961.
(4) Mr. C. S. Chandrasekhara Sastry, learned counsel for the respondent. urged for a reconsideration of our former decision and referred us to rule 5, clause (4) of the Central Sales-tax (Madras Rules, 1957. The rule reads as follows:
'If no return is submitted in respect of any month before the 25th day of the succeeding mouth or it the return is submitted without a chalan or a crossed cheque for the full amount of tax payable or it the return submitted appears to be incorrect or incomplete, the assessing authority shall after making such enquiry as he considers necessary and after giving the dealer an opportunity of proving the correctness and completeness of the return where one had been submitted, determine the turnover to the bash of his judgment and provisionally assess the tax or taxes payable for the month and shall serve upon the dealer a notice in form 2 and the dealer shall pay the sum demanded at the time and in the manner specified in the notice.'
The argument, of the learned counsel for the respondent is that a return unaccompanied by the C form is only an incomplete return and the assessing authority should give the assessee an opportunity of proving the completeness of the return and that really means that C forms can be produced subsequent to the filing of the return, subject to the discretion of the assessing authority to receive them or not. We are unable to see how the return in form I can be said to he incomplete because of the absence of C form. The non-sub-mission of C form will have the consequence of the assessee not obtaining the benefit of S. 8(1) but cannot in any way vitiate the return or render it incomplete or defective. There is no sub-stance in this contention, and we are clearly of opinion that the view expressed by us in our decision in T. C. No. 89 of 1961 is correct and needs no modification or change.
(5) The turnover of Rs. 1640(S. No. 1) In the tabular column and Rs. 1440 (S. No. 2) Should therefore fall not under S. 8(1) of the Act, but under S. 8(2) of the Act, and they should suffer the tax at the rate of seven per cent.
(6) We shall now deal with S. Nos. 3 and 5 to 10. In respect of these sale transactions. the C forms produced are alleged to be defective an not lib conformity with the rule as the purpose of the sale, whether it was for resale or whether it was for use in manufacturing or processing goods for re-sale or whether it was for use in mining or in generation and distribution, of power, was not specifically stated. The C form contains all those purposes and no 'purpose' is struck out in the form and the defect pointed out is that the non-resident buyer should specify the purpose for which he bought and should not have left that 'purpose' in doubt by keeping all the 'purposes' set out in the form intact without scoring out the 'purposes' for which he did not buy.
(7) It will mow be convenient to refer to the provision of the Act. Section 8(1) of the Act provides that,
'Every dealer, who in the course of inter-State trade or commerce (a) sells to the Government any goods; or (b) sells to a registered dealer other than the Government goods of the description referred to in sub-section (3) shall be liable to pay tax under this Act. which shall be one per cent for his turnovers.'
The Act deals with two categories of goods, 'the declared goods' and 'goods other than declared goods'. Declared goods are defined as goods declared under Sec. 14 to be of special importance in inter-State trade or commerce. Section 14 gives the following list of ten goods as of special importance. Coal, cotton, hides and skins, iron and steel, jute, Oil seeds, rayon or artificial silk fabrics, sugar, tobacco and woollen fabrics. As S. 8(1) confers a benefit of the concessional levy of one per cent. in respect of sales of the description mentioned in sub-section (3), we shall refer to S. 8(3) and that reads.
'The goods referred to in clause (b) of subsection (1)-
(a) in the case of declared goods are goods of the class or class' specified in the certificate of registration of the registered dealer purchasing the goods as being intended for resale by him;
(b) in the case of goods other than declared goods are goods of the class or clauses specified in the certificate of registration of the registered dealer purchasing the goods as being intended for resale by him or subject to any rules made by the Central Government in this behalf, for use by him in the manufacture of processing of goods for sale or in mining or in the generation or distribution of electricity or any other from of power;......'
The goods forming the subject-matter of the sale in the instant case are not declared goods within the meaning of the Act. In regard to such goods the concessional levy at the rate of on per cent. under S. 8(1) can be obtained by a registered dealer it the goods purchased are intended for resale by the buyer, or for use by him in the manufacturing or processing of goods for sale or in mining or in the generation or distribution of electricity or in any other form or power. Rule 13 of the Central Sales-tax (Registration and Turnover) Rules of 1957 provides that the goods referred to in clause (b) of sub-sec. (3) of sub-sec which a registered dealer may purchase small be goods Intended for use by him as raw materials, processing materials, machinery plant, equipment tools, stores, spare parts, accessories, fuel or lubricants in the manufacture or processing of goods for sale or in mining or in the generation and distribution of electricity or any other. form of power.
(8) In the case of 'non-declared goods' levy of one per cent. under S. 8(1) will be attracted if the purchaser. intended the goods for any one or More than one of the following purposes: (1) Resale (2) Use in the manufacture or Processing goods for sale; (3) Mining; (4) Generation or distribution of electricity or any other form of power. The statute does not restrict the applicability of Section 8(1) to a sale transaction in a case where the purpose is only one of the of our purpose set out. So long as the purchaser intends the purchase of the goods f or any or all of the purposes provide for under S. 8(3)(b) of the Act, the benefit of Sec. 8(1) levy coin be fully availed of. We are unable to see any defect or irregularity in the C form produced by the petitioner in regard to S. Nos. 3 and 5 to 10 merely because no column relating to the 'purposes' is struck out but all the columns are left intact. The C form produced 15 strictly and literally in compliance with the form prescribed under the rules. A proper interpretation of the C forms made available to the petitioner would be to hold that the lion resident buyer Intended the purchase for all the purposes set out in the form. Yet the forms do case to be in accord with the rule orbit conformity the prescribed form.
It is wholly unnecessary for the assessing authority to investigate the truth or otherwise of the manifest representation made by the non-resident buyer by his keeping all the purposes. set out in the form without deleting any one or more of them. The petitioner has no manner of control over the non-resident buyer to compel him to be more specific, than what he has chosen to do by sending the C forms in the manner in which the did. Any false representation by the non-resident buyer who has signed the C forms will certainly expose in to grave consequences for breach of statutory provisions, but the forms as such cannot be condemned and put aside to defeat the seller's right and claim of taxation under S. 8(1) of the Act. We are of opinion that in regard to S. Nos. 3 and 5 to 10 of the aggregate turnover of the Rs. 30775 should be taxed under S. 8(1) at the rate of one per cent. To this extent they decision of the Tribunal is correct.
(9) What remains is only 4 relating to a turnover of Rs. 350 which has been subjected to tax at the rate of 7 per cent on the ground that the C form does not mention the date of registration. The C form is admittedly lacking in a material particular by reason of this omission. This should therefore attract tax only at the rate of per cent. under S. 8(2) of the Act.
(10) In the result, the decision of the Tribunal is confirmed in regard to S. Nos. 3 and 5 to 10 and set aside in regard to S. Nos. 1, 2 and 4. The revision petition is partly. allowed. There will be no order as to costs.
(11) Revision partly allowed.