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TMI Blog1958 (2) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... t Sabai Grass Ltd. are the respondents. The respondents entered appearance and filed a statement of their case; but later they withdrew appearanceand at the final hearing of the appeal, we have had the assistance of the learned Solicitor-General alone, who appeared in support of the appeal. The facts relating to the appeal lie within a very narrow compass. Messrs Bharat Sabai Grass Ltd., a limited company incorporated under the Indian Companies Act, 1913, had their head office in Calcutta. They carried on the business of collection of bamboo and sabai grass in Orissa and sold the same to certain mills which manufacture paper, namely, the Orient Paper Mill, which is situate in Orissa, and Titagarh Paper Mill and Bengal Paper Mill, si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arts: one related to the first six quarters during which the respondents carried on business in bamboo and sabai grass in Sambalpur which was part of Orissa from before; and the second to the last two quarters during which the respondents carried on business also in Bamra and Gangpur, two of the Orissa States, which were integrated into Orissa after certain merger agreements. The Act came into force in Bamra and Gangpur areas on April 1, 1949; there- fore for the first six quarters the Sales Tax Officer estimated the gross turnover at Rs. 15,000 for each quarter, and for the remaining period, he estimated the turnover at Rs. 30,000 per quarter. In this way the Sales Tax Officer, Sambalpur, estimated the total gross turnover to be Rs. 1,50,0 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gative and held that the assessment on the respondents was not legal. The present appellant then moved the High Court for a certificate and, this having been refused, the appellant moved this Court and obtained special leave to appeal. It is necessary to explain here, in somewhat greater detail, the reasons why the learned Judges of the High Court of Orissa thought that the particular question of law arose on the facts of the case and called for a reference of that question. The Act received the assent of the Governor-General on April 26, 1947, and was published in the Orissa Gazette on May 14, 1947. Section 1 of the Act came into force at once and the rest of the Act came into force on August 1, 1947. On August 30, 1947, a notification und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case, the main contention of the learned advocate, appearing for the petitioners is that the assessment is illegal inasmuch as the assessment is based upon the legal position that mere contract for sale in the State of Orissa is sufficient to make it taxable under the provisions of the Orissa Sales Tax Act as a contract for sale is deemed to be a sale under the second proviso to section 2(g). The whole basis of assessment is the order of the Sales Tax Officer, Sambalpur, dated December 16, 1949, and the Collector's letter dated September 22, 1948. From the letter of the Collector as we have quoted above, we find that, according to him, mere export of bamboo is sufficient to constitute a sale in Orissa. There seems to be enough force in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from mere agreements to sell) of bamboo and sabai grass in Orissa, and the respondents in spite of sufficient time having been given to them did not produce any account books or any other evidence to prove that the sales took place elsewhere. No question was raised before the Sales Tax Officer that the transactions on which assessment was sought to be made were not "sales" but mere "agreements to sell". The same view was again reiterated by the Assistant Collector of Sales Tax, who was the appellate authority and before whom also the contention was that the sales did not take place in Orissa. He repelled the contention and said that there was no evidence to show that the sales did not take place in Orissa. It may be stated here that admitte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncluded forward contracts and the point for decision was whether the power to impose tax on the sale of goods under Entry 48 in List II of the Seventh Schedule to the Government of India Act, 1935, included the power to impose a tax on forward contracts. In that context the distinction between a "sale of goods" and an "agree- ment for a sale of goods" was pointed out, and the legal position was thus summarised: "The position therefore is that the liability to be assessed to sales tax can arise only if there is a completed sale under which price is paid or is payable and not when there is only agreement to sell, which can only result in a claim for damages; the power con- ferred under Entry 48 to impose tax on the sale of goods can therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X
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