TMI Blog1989 (4) TMI 301X X X X Extracts X X X X X X X X Extracts X X X X ..... evant portion of the notification reads thus: "In exercise of the powers conferred by section 8-A of the Karnataka Sales Tax Act, 1957 (Karnataka Act 25 of 1957), the Government of Karnataka hereby exempts with effect from first day of September, 1982, the tax payable under the said Act on the sale of goods specified in the Schedule below: * * * 2.. Student note-books, exercise books, copy books, outline maps, pencils, erasers, instrument boxes, dissection boxes, T-squares and drawing boards, provided that the price of each such goods does not exceed fifty rupees. * * *" (emphasise supplied) Interpreting this notification the Commissioner of Commercial Taxes has issued a clarification on 22nd February, 1988 stating that in respe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to that levy. 5.. Tax on the turnover of sales or purchases is levied under entry 54, List II of the Seventh Schedule to the Constitution. The levy under section 6-B is in the nature of sales tax when the turnover of the dealers exceeds a limit in a year and it is a tax on the aggregate of the sales effected by the dealers during the year as held in S. Kodar v. State of Kerala [1974] 34 STC 73 at page 76 (SC) while dealing with a provision of the Tamil Nadu Additional Sales Tax Act which is similar to section 6-B of the Act. In essence there being no difference between the two kinds of levy one under section 5 or 6 and another under section O-B of the Act the contention of the respondents to the contrary is rejected. 6.. The learne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de from the total turnover of a dealer.", and therefore contended that no other exemption is permissible under the Act except in the manner as provided in section 6-B itself. But what was considered in the case was only the effect of the second proviso and not the effect of section 8-A at all. 7.. In B.P. Automobiles' case [1984] 55 STC 93 (Kar) and Shantilal Brothers' case [1985] 59 STC 178 (Kar) the court was concerned with the ascertainment of turnover which attracts tax under section 6-B and exclusion or deduction under the proviso to sub-section (1) of section 6-B of the Act. In calculating that turnover, deductions will have to be given to those specific items mentioned in clauses (i) to (vii) in the first proviso and no other. It d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . On the other hand, the legislature having understood that the tax under section 8-A also covered a tax levied under section 6-B of the Act, the explanation became necessary. But the explanation was confined to only one sub-section and not to the entire section. The notification in question that has been issued is only under section 8-A(1) of the Act and, therefore, the explanation though had no effect upon the notification issued, it has a bearing on the interpretation of the section. Therefore, both on the ground that section 2(1)(u) of the Act defines the word "tax" in a comprehensive manner to include turnover tax levied under section 6-B of the Act and the explanation referred to above makes the matter further clear, it has to be un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s tax and turnover tax. The turnover tax is traceable to entry 54, List II of the Seventh Schedule to the Constitution, and is also a tax on the sale of goods. The notification cannot be read in the manner as suggested by the learned counsel for the State as exempting only tax payable on the sale or purchase of goods, but not turnover tax. As explained above, the second proviso to the section also does not come in the way of holding that this notification covers tax levied under section 6-B of the Act. Learned counsel for the State however contended that there is an essential difference between the types of tax levied under sections 5 and 6 and section 6-B of the Act inasmuch as the tax levied under the former provisions could be passed on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tracing the legislative history of the exemption granted to student note-books stated that originally a notification had been issued dated 28/30th March, 1976 by which the student note-books and other aids of students were exempt from tax which was in exercise of the powers under section 8-A of the Act. Later on by Act 23 of 1983 these items were taken to entry 42-B, List II of the Fifth Schedule, which was effective between 1st April, 1982 and 31st August, 1982. It was omitted with effect from 1st September, 1982. On that day a notification, to which a reference has already been made, was issued. On this legislative history the learned counsel for the State contended that while originally the items referred at item 2 in the Schedule to th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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