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1964 (11) TMI 58 - SC - VAT and Sales TaxWhether tax liability could be fastened on the appellant immediately it entered into the agreement of hire-purchase? Whether the tax could only be constitutionally and legally levied after the intending purchaser had exercised the option which resulted in the transfer of property in the vehicle to such person? Held that:- Allow the appeals in part and set aside the order of the High Court and the assessments made, and direct that the Sales Tax Authorities will determine the price in accordance with what we have said above that The first part may be determined after finding out the proper amount to be paid as hire in the market for a vehicle of the type concerned, or in such other way as may be available to the Sales Tax Authorities. The second method may be to take the original price fixed in the hire- purchase agreement and to calculate the depreciation and all other factors that may be relevant in arriving at the price when the second sale takes place to the hirer including the condition of the vehicle at the time of the second sale. It is therefore for the Sales Tax Authorities to find out the price of the vehicle on which tax has to be paid in either of the ways indicated by us above or such other way as may be just and reasonable and thereafter proceed to levy sales tax according to law.
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