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Deputy Commissioner of Commercial Taxes, Madras Division Vs. O.K. Agencies - Court Judgment

LegalCrystal Citation
SubjectSales Tax
CourtChennai High Court
Decided On
Case Number Tax Case No. 85 of 1964 (Revision No. 46)
Judge
Reported in[1967]20STC145(Mad)
AppellantDeputy Commissioner of Commercial Taxes, Madras Division
RespondentO.K. Agencies
Appellant Advocate K. Venkataswami, Adv. for Additional Government Pleader
Respondent Advocate V. Ramachandran, Adv.
DispositionPetition allowed
Excerpt:
- - 1. the assessee, who is the respondent, having failed to get exemption from tax on a turnover of rs. the department went upon the basis that as the respondent failed to comply with rule 26(13) of the madras general sales tax rules, 1959, it necessarily followed that the respondent forfeited his right to single point taxation, even if he had otherwise established that the transactions to the value of rs......the department went upon the basis that as the respondent failed to comply with rule 26(13) of the madras general sales tax rules, 1959, it necessarily followed that the respondent forfeited his right to single point taxation, even if he had otherwise established that the transactions to the value of rs. 6,227 relate to second sales.2. we do not think that rule 26(13) of the madras general sales tax rules is mandatory. the rule does not say so. it merely relates to a manner of keeping accounts. section 3(2) of the madras general sales tax act, 1959, is quite clear that in the case of goods mentioned in the first schedule, the tax is payable by the buyer at the rate and only at the point specified therein on the turnover in each year. this sub-section is not subject to any other provision.....
Judgment:
ORDER

Veeraswami, J.

1. The assessee, who is the respondent, having failed to get exemption from tax on a turnover of Rs. 6,227 as representing second purchases, successfully appealed to the Tribunal. The department went upon the basis that as the respondent failed to comply with Rule 26(13) of the Madras General Sales Tax Rules, 1959, it necessarily followed that the respondent forfeited his right to single point taxation, even if he had otherwise established that the transactions to the value of Rs. 6,227 relate to second sales.

2. We do not think that Rule 26(13) of the Madras General Sales Tax Rules is mandatory. The rule does not say so. It merely relates to a manner of keeping accounts. Section 3(2) of the Madras General Sales Tax Act, 1959, is quite clear that in the case of goods mentioned in the First Schedule, the tax is payable by the buyer at the rate and only at the point specified therein on the turnover in each year. This sub-section is not subject to any other provision or rule to be made. The concession under Sub-section (2) of Section 3 is absolute. But the only condition for obtaining the concession is to show that the sale or purchase is not at the point specified in the First Schedule. Our attention has been invited to a judgment of this Court in T. C. No. 247 of 1962. But, with due respect, no reference was there made to Section 3(2), which governs single point liability. The effect of the section is that where the transactions are second purchases or-sales, there is no liability on them, as the single point of levy is fixed at the stage of first purchase of the goods in question. Neither the revenue authority nor the Tribunal has recorded a specific or satisfactory finding with reference to the material on record that the purchases were not second purchases. No doubt Section 10 provides a rule of presumption and throws the burden on the assessee. But we consider, in the circumstances, that the respondent should be given another opportunity of convincing the department that the purchases to the tune of Rs. 6,227 were second purchases.

3. The tax revision is allowed and the matter is remitted to the assessing authority for consideration and disposal in respect of a turnover of Rs. 6,227. No costs.


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