TMI Blog1998 (4) TMI 484X X X X Extracts X X X X X X X X Extracts X X X X ..... le in the State or any intermediate sale in the State. If the single point is fixed by the State at, say, the point of first sale and the State exempts the first sale from payment of tax, either by a general provision or a specific provision applicable to a class of seller, a particular seller or the goods sold may not be subjected to tax at either that point of first sale or any subsequent sale in the State. There is no warrant for the emphasis that would appear to have been placed by the Madras High Court on the phrase “taxable sale” - Civil Appeal No. 4976-4979 of 1994, W.P. No. 736, 762 of 1995 - - - Dated:- 22-4-1998 - BHARUCHA S.P. AND KHARE V.N. JJ. Mrs. Indu Malhotra, for the appellants. T. Harish Kumar and V. Krishnana ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as been communicated to all D.C.s in the reference cited. On a further point raised by D.C. (OT), Madurai or reconsideration of the clarification issued in the reference cited that there was no need to revise the said clarification issued in the reference dated July 30, 1991. 2.. The High Court, Madras in its judgment dated March 13, 1991 on T.C. No.6 of 1991 filed by Royal Steel Traders v. Joint Commissioner of Commercial Taxes III [1992] 1 MTCR 580 following its earlier judgment in the case of Vasu General Traders [1987] 66 STC 358 (Mad.) has held that a sale has referred to taxable sale for the purpose of the Tamil Nadu General Sales Tax Act and not sales, which are exempted, and that since the Tamil Nadu Electricity Board was exempted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng sold by the said Board, they were covered by a notification dated December 1, 1982 issued by the first respondent under the provisions of section 17(1) of the State Act and, therefore, exempt from tax payable under the State Act. 4.. Under section 14 of the Central Sales Tax Act, 1956 iron and steel are declared to be goods of special importance in inter-State trade and commerce. They are, by reason of the provisions of section 15 of the Central Act, liable to tax at a rate that does not exceed 4 per cent of the sale or purchase price thereof and such tax shall not be levied at more than one stage . Section 3 of the State Act requires every dealer, subject to the turnover therein mentioned, to pay a tax for each year in accordance wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provides for single point levy. In cases where there are no exemption orders and the State fixed the second or subsequent sale as point of taxation the first or prior or subsequent sales are not exempted sales but are not taxable sales. 7.. Learned counsel drew our attention to the judgment of the Madras High Court itself in State of Madras v. T. Narayanaswami Naidu [1965] 16 STC 29, which had not been noticed in the cases of Vasu General Traders [1987] 66 STC 358 (Mad.) and Royal Steel Traders [1992] 1 MTCR 580 mentioned in the impugned circular. In Narayanaswami Naidu s case [1965] 16 STC 29 the Madras High Court said: As pointed out above, there may be marginal transactions where the exigible event and the exigible stage may fall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... int of last purchase to the dealer, who sold the groundnut to the exporter. 9.. We may now look at the judgments in Vasu Traders v. State of Tamil Nadu [1987] 66 STC 358 (Mad.) and Royal Steel Traders v. Joint Commissioner of Commercial Taxes III [1992] 1 MTCR 580 (Mad.). The case of Vasu Traders [1987] 66 STC 358 (Mad.) did not deal with declared goods. It dealt with handmade matches which were covered by an exemption notification. The petitioner before the High Court had purchased matches from a manufacturer who was covered by that exemption notification. The petitioner contended that the point of levy being the first sale in the State and the first sale having been exempted from payment of tax, there was no tax liability in respect of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court held on the material before it that the authorities below had not been right in proceeding on the basis that there had been a sale of old iron and scrap materials from the Life Insurance Corporation of India to the assessee, which sale would have been exempted from tax. The Corporation had sold the superstructure to the assessee for the purpose of demolition and clearance of debris. The sale of the old iron scrap obtained from the debris was, therefore, its first sale by the assessee. 12.. We do not think that the conclusion reached by the Madras High Court in the order under appeal can be upheld. The goods with which we are concerned being declared goods, they can only be taxed at a single point; that is, only one sale in the State ..... X X X X Extracts X X X X X X X X Extracts X X X X
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