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1983 (5) TMI 32 - SC - VAT and Sales TaxWhether there is repugnancy between sub-s. (3) of s. 5 of the Bihar Finance Act, 1981 and para. 21 of the Control Order and, therefore, sub-s. (3) of s. 5 must yield to that extent? Held that:- The contention that sub-s. (3) of s. 5 of the Act constitutes an unreasonable restriction upon the freedom of trade guaranteed under art. 19(1)(g) of the Constitution proceeds on the basis that sales tax being essentially an indirect tax, it was not competent for the Legislature to make a provision prohibiting the dealer from collecting the amount of surcharge cannot prevail. Merely because a dealer falling within the class defined under sub-s. (1) of s. 5 of the Act is prevented from collecting the surcharge recovered from him, does not affect the competence of the State Legislature to make a provision like sub-s. (3) of s. 5 of the Act nor does it become a tax on his income. It is no doubt true that a, sales tax is, according to the accepted notions, intended to be passed on to the buyer, and the provisions authorising and regulating the collection of sales tax by the seller from the purchaser are a usual feature of sales tax legislation. It is not an essential characteristic of sales tax that the seller must have the right to pass it on to the consumer, nor is the power of the Legislature to impose a tax on sales conditional on its making provision for sellers to collect the tax from the purchasers.
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