TMI Blog1976 (10) TMI 102X X X X Extracts X X X X X X X X Extracts X X X X ..... Advocates, for the respondent. -------------------------------------------------- The judgment of the Court was delivered by KHANNA, J.- This appeal by special leave is against the judgment of the Madras High Court whereby the High Court dismissed the petition filed by the appellant under section 38 of the Tamil Nadu General Sales Tax Act, 1959 (hereinafter referred to as the State Act). The matter relates to the assessment year 1960-61. The appellant- firm is a dealer in cotton yarn. The appellant bought yarn from local dealers and manufacturers and, in turn, sold that yarn by way of inter- State sale. Sales tax under the State Act on the yarn purchased by the appellant had been paid by those manufacturers and dealers. The inter- State sales of yarn made by the appellant were assessed to tax under the Central Sales Tax Act (hereinafter referred to as the Central Act) in the hands of the appellant. The appellant claimed refund of the tax amounting to Rs. 16,769.96 paid under the State Act in respect of the yarn sold by it in the course of inter-State trade in accordance with section 15(b) of the Central Act and the proviso to section 4 of the State Act read wit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er-State trade or commerce, the tax so levied shall be refunded to such person in such manner and subject to such conditions as may be provided in any law in force in that State." Section 4 of the State Act reads as under: "4. Tax in respect of declared goods. -Notwithstanding anything contained in section 3, the tax under this Act shall be payable by a dealer on the sale or purchase inside the State of declared goods at the rate and only at the point specified against each in the Second Schedule on the turnover in such goods in each year, whatever be the quantum of turnover in that year: Provided that where a tax has been levied under this section in respect of the sale or purchase of declared goods and such goods are sold in the course of inter-State trade or commerce, the tax so levied shall be refunded to such person in such manner and subject to such conditions as may be prescribed." According to the Second Schedule to the State Act, the tax on cotton yarn but excluding cotton yarn waste shall be one per cent at the point of the first sale in the State. Clauses (1) to (3) of rule 23 of the Madras General Sales Tax Rules, 1959, read as under: "23. (1) The tax lev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te law in respect of sale or purchase of declared goods which are subsequently sold in the course of inter-State trade or commerce, the tax so levied shall be refunded to such person in such manner and subject to such conditions as may be prescribed in any law in force in that State. Section 4 of the State Act has been enacted in conformity with section 15 of the Central Act. The proviso to that section deals with the refund of the sales tax levied under the State Act in respect of declared goods when such goods are sold in the course of inter-State trade or commerce. According to that proviso, where a tax has been levied under section 4 in respect of the sale or purchase of declared goods, and such goods are sold in the course of inter-State trade or commerce, the amount of tax shall be refunded to such person in such manner and subject to such conditions as may be prescribed. In pursuance of this proviso, the State Government has framed rule 23 of the Madras General Sales Tax Rules, 1959. According to clause (1) of that rule, the refund of the sales tax has to be made to the dealer who makes the inter-State sale and who has paid the sales tax under the Central Act in respect of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. The context in which the word "refunded" is used shows that such repayment need not be to the person who initially paid the tax. It is indeed for the State Legislature to specify the person to whom such amount is to be repaid either in the statute enacted by it or to make a provision for that purpose in the Rules. The State Legislature has made it clear in the proviso to section 4 of the statute that provision in this respect would be made in the Rules. The Rules which have been framed leave no doubt that the amount has to be paid to the dealer who sells the goods in the course of inter-State trade and who has paid the tax under the Central Act in respect of such sale. There is also no anomaly in paying the amount of the sales tax under the State Act to a dealer who sells declared goods in the course of inter- State trade, even though he did not himself pay the tax under the State Act in respect of those goods. The reason for that is that the price charged from such dealer by the person from whom he purchases the goods would normally take into account the sales tax paid by the seller. Assuming that there was some ambiguity in the language of clause (b) of section 15, as i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f Craies on Statute Law (Sixth Ed.), which read as under: "........ In Cape Brandy Syndicate v. I.R.C.[1921] 2 K.B. 403 at 414., Lord Sterndale, M.R., said: 'I think it is clearly established in Att.-Gen. v. Clarkson [1900] 1 Q.B. 156., that subsequent legislation may be looked at in order to see the proper construction to be put upon an earlier Act where that earlier Act is ambiguous. I quite agree that subsequent legislation if it proceeded on an erroneous construction of previous legislation cannot alter that previous legislation; but if there be any ambiguity in the earlier legislation, then the subsequent legislation may fix the proper interpretation which is to be put upon the earlier.'" Looking to all the facts, we are of the view that the appellant-firm is entitled to be paid the amount of sales tax levied under the State Act in respect of the goods sold by it in the course of inter-State trade provided the appellant has paid the sales tax under the Central Act in respect of those sales. We accordingly accept the appeal, set aside the judgment of the High Court and order that the appellant-firm be paid the amount of sales tax levied under the State Act in respect of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
