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TMI Blog1959 (9) TMI 40X X X X Extracts X X X X X X X X Extracts X X X X ..... outside the State for sale within their respective areas. The assessee contended before us, in his application preferred under section 12-B of the Act, that neither of these items should have been included in its assessable turnover. Normally we should have held that the question, whether each of these items is assessable to sales tax, is concluded by the authority of prior decisions of this Court. It was held in Ashok Leyland Ltd. v. State of Madras(1), that such sales completed by delivery of the cars within the State of Madras, though the sales were for subsequent transport of those cars to areas outside the State for further sales there, were intra-State sales within the State of Madras and were not sales in the course of inter-State trade within the scope of Article 286(2) of the Constitution, as it stood in the relevant year before it was amended. The principle applied in Ashok Leyland case [1957] 8 S.T.C. 210. was the one laid down in the earlier decisions of this Court, Indian Coffee Board v. State of Madras [1956] 7 S.T.C. 135. and State of Madras v. Indian Coffee Board[1956] 7 S.T.C. 522. If the principle thus re-affirmed in Ashok Leyland case [1957] 8 S.T.C. 210. were t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the purposes of exporting those goods was not a sale in the course of export, was re-affirmed by the Supreme Court in State of Madras v. Gurviah Naidu[1955] 6 S.T.C. 717. and State of Mysore v. Mysore Spinning and Manufacturing Co., Ltd.[1958] 9 S.T.C. 188. We are still of the view that the expression "in the course of" should have the same significance when it related to export and import trade to which Article 286(1)(b) of the Constitution applied and also when it related to interState trade or commerce which was regulated in the relevant period by Article 286(2) as it stood before it was amended. Mr. Venkatasubramania Aiyar referred to Queen v. Wilkinson; ex parte Brazell, Garlick and Co.85 C.L.R. 467., the principles laid down in which were quoted with approval by Das, J., as he then was, in his separate and dissenting judgment in State of Travancore-Cochin v. Shanmugha Vilas Cashew-nut Factory[1953] 4 S.T.C. 205 at page 238. Mr. Venkatasubramania Aiyar urged that neither that decision nor the observations of Das, J., were considered in any of the three decisions of this Court including that in Ashok Leyland's case[1957] 8 S.T.C. 210. Even so, we are unable to accept his c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e on the lines explained in Queen v. Wilkinson; ex parte Brazell, Garlick and Co.(2) We are unable to apply at this stage the test of commercial significance of the transaction postulated by the Australian High Court in the earlier decision and re-affirmed in Queen v. Wilkinson; ex parte Brazell, Garlick and Co.(2) Learned counsel referred to the test laid down by the Supreme Court of America in Phillips Petroleum Co. v. State of Wisconsin 98 Law Ed. 1035 at p. 1046., where the goods were destined for consumption in a State outside the one in which the goods were sold. In view of what we have said earlier, we feel unable to apply this test either in deciding the question at issue whether the sales of the motor cars were sales in the course of interState trade or commerce. In State of Madras v. K.H. Chambers Ltd.[1955] 6 S.T.C. 157 at p. 172., the learned Chief Justice referred to State of Travancore-Cochin v. Shanmugha Vilas Cashewnut Factory(1), and observed: "I must confess that but for the authoritative pronouncement of the Supreme Court in the Second Travancore case(1), I would have felt considerable difficulty in the construction of Article 286(1)(b) in its application to sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le turnover of the assessee in the year of assessment in question. The main contention of Mr. Venkatasubramania Aiyar was that Act XVII of 1954 was beyond the legislative competence of the Madras Legislature. That was the very contention negatived in Sundararajn and Co., Ltd. v. State of Madras[1956] 7 S.T.C. 105. Learned counsel referred to the well-recognised principle re-affirmed by the Privy Council in Motor Transport Commissioner v. Antill Ranger and Co., Pty. Ltd.[1956] A.C. 527., that a Legislature cannot give itself legislative power to tax something if in reality it did not have that legislative competence. Learned counsel urged that what section 8-13 of the Act provided for was the collection of a tax, and, if what was collected was a tax, it could not be brought within the scope of Entry 54 of List 11 of Schedule VII of the Constitution. In dealing with a similar contention what was recorded in Sundararajan's case [1956] 7 S.T.C. 105., was, "Even if the registered dealer collects the amount by way of tax under the authority of section 8-13 of the Act, the payment is by the purchaser on the occasion of the sale by the dealer. Vis-a-vis the dealer it is in reality part of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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