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TMI Blog1977 (2) TMI 45X X X X Extracts X X X X X X X X Extracts X X X X ..... ined the total turnover at Rs. 74,931-50 for assessment under s. 7 and also levied purchase tax under s. 7-A on a turnover of Rs. 25,653-50 at 4%. The assessing officer made an addition of 5% for omissions on the sale turnover of Rs. 46,931-00 and the defects are that the gross profit of 30% is high and that there was shortage of 0.010 grams of silver with reference to the stock register. The assessee filed an appeal against the above order and the Appellate Assistant Commissioner has found that the alleged two defects did not exist and deleted the addition of 5% on the sale turnover. On the other hand, the learned Appellate Assistant Commissioner has enhanced the total turnover to Rs. 86,652 by raising purchase turnover liable to tax under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2/70. Therefore, there is no doubt that the purchase turnover of the assessee for 1975-76 is Rs. 39,721 and the addition of Rs. 14,068 for the period upto 14th July, 1975 cannot be questioned. But the important point for consideration is whether the assessee is liable to purchase tax under s. 7-A. 6. s. 7-A reads as follows : "7-A(1) Every dealer who in the course of his business purchase from a registered dealer or from any other person, any goods the sale or purchase of which is liable to tax under this Act in circumstances in which no tax is payable under Ss. 3, 4 or 5 as the case may be, and either, (a) consumes such goods in the manufacture of other goods for sale or otherwise; or (b) dispose of such goods in any manner other than ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds for sale or otherwise or disposes of such goods in any manner other than by way of sale in the State or despatch them to a place outside the State except as a direct result of sale or purchase in the course of inter-State trade or commerce, as a basis for the levy of purchase tax on such turnover. (A) Thus it is the turnover of s. 3, 4 and 5 only that has come up for tax under s. 7-A at the purchase stage under the circumstances indicated in it. The assessee has opted to pay tax under s. 7 of the Act and has accordingly filed his return only in Form AAI under s. 7. He has also been permitted to be assessed under s. 7. 7. s. 3(1) provides that every dealer (other than a casual trader or agent of a non-resident dealer) whose total turnove ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... was no levy of purchase tax under s. 7-, as s. 7-A was newly introduced from Act 2 of 1970 with effect from 27th November, 1969. Therefore, a reading of the definition of "turnover" in the Tamil Nadu General Sales Tax Act upto 26th November, 1969 would relate only to the sales turnover and not to the purchase turnover. 8. Under s. 2(p) of the Act, 'taxable turnover' means the turnover on which a dealer shall be liable to pay tax as determined after making such deductions from his total turnover and in such manner as may be prescribed. Under s. 2(q) of the said Act, total turnover means the aggregate turnover in all goods of a dealer at all places of business in the State, whether or not the whole or any portion of such turnover is liable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... SESSMENT :-- (1) Save as provided in sub R. (2), the total turnover of a dealer for the purpose of these rules shall be the amount for which goods are sold by the dealer (2) In the case of the under mentioned goods the total turnover of a dealer for the purpose of these rules shall be the amount for which the goods are brought by the dealer :-- (a) Cotton (b) Raw hides and skins (c) Wattle bark, Avaram bark, Konnam bark, Wattle extract, Quobracho and Chestnut extract (d) Omitted (e) Palmyrah fibres and stalks (f) Potatoes (g) Cardamom (h) Sugarcane (i) Groundnut (j) Jaggery ann gur (other than palm jaggery) (k) Cocoanut (including copra, and) (l) Raw rubber namely latex 10. The proviso to s. 7-A reads that a dealer purchasing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the main return". As per G.O. No. p. 4001, Revenue dated 28th December, 1970, the above note has been included. Thus, it is quite clear that for determining the total turnover of the business, the purchases turnover should not be included in Form AI or AAI. This aspect also supports the view outlined by us in paras 7 and 8 and 9 supra. Therefore, we find that both the lower authorities have fallen into an error in adding the purchase turnover of the assessee for the purpose of determining the turnover under s. 7-A. 7. If the purchase turnover of Rs. 39,721.50 is excluded from the total turnover, the assessee's assessable turnover is only Rs. 46.931. Therefore, under the proviso to s. 7-A (1), the assessee is not liable to pay purchase ..... X X X X Extracts X X X X X X X X Extracts X X X X
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