TMI Blog1959 (3) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... could charge only the ex-mill price plus excise duty plus sales tax on ex-mill price and the excise duty. The goods having been sold to the depots were disposed of during the year by the depots to the consumers for Rs. 46,54,333-12-6. The Sales Tax Officer assessed the applicant on the amount of sales as effected by the depots and not on the sales effected by the mills to the depots. The mill thereupon filed a revision to the Judge (Revisions) Sales Tax, Lucknow, but the revision was dismissed. Then an application was made under section 11 to the Judge (Revisions) Sales Tax to make a reference to the High Court. But the Judge (Revisions) was of opinion that there was no question of law necessitating a reference to this Court and he rejecte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... "cotton yarn" manufactured by the mills and the "cloth" manufactured by mills. If they are manufactured in the State, sales tax is to be paid at single point by the manufacturer at a rate of 6 pies per rupee. Thus from this notification it is clear that the sales tax is payable by the manufacturer as the goods are manufactured in the present case in the State. Clause 4 of the U.P. Controlled Cotton Cloth and Yarn Dealers' Licensing Order, 1948, runs as follows: "Subject to the provision of clause 16 no person other than a dealer shall obtain or attempt to obtain or store for sale or distribute controlled cotton cloth or cotton yarn and save as hereinafter provided, no dealer shall obtain or attempt to obtain or store for sale or distributio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls were also to be treated as district importers meaning thereby that they were also allowed to carry on the business under Licence B. There were certain restrictions which had been put, but we are not concerned with them in this case. In accordance with this letter the Vikram Cotton Mills had opened certain depots and these depots had Licence B. The mill used to supply cloth to these depots at ex-mill price. The depots were permitted to sell at about 10 per cent. profit and charged tax which was originally charged by the mill. It was contended on behalf of the applicant that when the mill as manufacturer had transferred the goods to the depots, who were the district importers or the wholesale dealers, the sale had been effected and when ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been transferred by the company to the depot, the function of the company as manufacturer had ceased and, thereafter, it was the function of a wholesale dealer that it was performing. Under the circumstances, we think the learned counsel for the applicant is correct and the sales tax could only be charged on the turnover of the mill and not on the turnover of the depots. There is yet another ground on which, we think the tax should be charged only on the mill turnover and not on the depots' turnover. The depots under B licence could not only sell the goods obtained from the mill but they could, if they so liked, also obtain goods from other mills as district importers and sell them. In that event there could not possibly have been any sco ..... X X X X Extracts X X X X X X X X Extracts X X X X
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