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1987 (2) TMI 488 - HC - VAT and Sales Tax
Issues:
1. Sales tax imposed on procurement of rice under state agency. 2. Constitutionality of sales tax imposition under amended provisions. 3. Interpretation of procurement price and inclusion of sales tax. Analysis: 1. The judgment dealt with multiple Civil Writ Petitions challenging the sales tax imposed on the procurement of rice by various petitioners through state agencies under different state-specific orders. The main contention was whether these transactions could be considered as sales subject to taxation under the relevant state sales tax laws. 2. The State of Haryana argued that the Constitution (Forty-sixth Amendment) Act, 1982, broadened the scope of "tax on sale or purchase of goods" to include transfers of property in goods acquired under levy orders. Consequently, the Haryana General Sales Tax Act was amended to reflect this change, making such acquisitions subject to sales tax retrospectively from February 2, 1983. The State emphasized that private dealers' cases should be decided based on the amended provisions of the Act. 3. On the other hand, the petitioners contended that even after the amendment, the nature of the transactions remained akin to acquisitions rather than sales. They argued that since the procurement price was fixed by the State Government, and sales tax could not be charged at the time of sale to the government, they were not liable to pay sales tax subsequently. The petitioners relied on a previous judgment to support their position. 4. The interpretation of the procurement price, as specified in the Haryana Rice Procurement (Levy) Order, was crucial to the judgment. The Advocate-General of Haryana highlighted that the procurement price, exclusive of certain costs and taxes, should include sales tax according to the provisions of the Levy Order. This interpretation supported the State's position that sales tax could be levied on dealers for transactions of rice procurement under the amended laws. 5. Ultimately, the Court dismissed the writ petitions, upholding the State's right to levy sales tax on dealers involved in rice procurement transactions under the amended provisions of the Haryana General Sales Tax Act. The judgment clarified the tax implications of such transactions post the constitutional amendment and emphasized the inclusion of sales tax in the procurement price as fixed by the State Government. 6. Both judges, D.S. Tewatia and J.V. Gupta, concurred with the decision to dismiss the writ petitions, thereby settling the common issue raised in all the cases before the Court. The judgment provided clarity on the taxation of transactions involving the procurement of essential commodities through state agencies, ensuring compliance with the amended legal framework.
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