TMI Blog1960 (7) TMI 55X X X X Extracts X X X X X X X X Extracts X X X X ..... Orissa. Messrs S. Lal Co., are also another firm of registered dealers in Orissa holding registration certificate No. 1335-BA. In their certificate it was specified that "minerals" were one of the goods which the said firm was entitled to buy in Orissa, free of sales tax, for the purpose of resale in Orissa (see Form III). It is admitted that in the certificate no maximum limit was mentioned for the purchase of minerals by this firm. For the period in question Messrs S. Lal Co. purchased chromium ore from Messrs Tullock Co., without paying any sales tax on it, in view of the exemption provided in section 5(2)(a)(ii) of the Act. It was further admitted that the chromium ore so purchased was not resold in Orissa, but was sold in Calcutt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acking of such goods: Provided that when such goods are used by the registered dealer for purposes other than those specified in his certificate of registration, the price of goods so utilised shall be included in his taxable turnover. (iii)............................................................................... Sub-clauses (i) and (iii) are not material for our purpose. If a natural meaning is given to the words used in sub-clause (ii) the obvious conclusion is that if a registered dealer in Orissa sells goods to another registered dealer in Orissa and in the certificate of registration of the purchasing dealer it is specified that the said goods are intended for resale by him in Orissa, the selling dealer need not include suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iso to sub-clause (ii) of clause (a) of sub-section (2) of section 5. 5.. Instead of disposing of the appeal by giving a natural meaning to the words used in the aforesaid sub-clause, the learned Member, Sales Tax Tribunal, has drawn on his imagination and given an artificial construction to the same, mainly on the basis of his own interpretation of rule 27(2) of the Orissa Sales Tax Rules which is as follows: "27. Evidence in support of deductions claimed.- (1)................. (2) Claims for deduction of turnover under sub-clause (ii) of clause (a) of sub-section (2) of section 5-A dealer who wishes to deduct from his gross turnover on sales which might have taken place in Orissa the amount of a sale on the ground that he is entit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iven by Messrs Lal Co. to Messrs Tullock Co. On the basis of that finding the Tribunal held that Messrs Lal Co. never gave any assurance to Messrs Tullock Co. that the chromium ore covered by these transactions was intended for resale in Orissa and that consequently it was "not used for purposes other than those specified in the certificate of registration" and that the proviso to subclause (ii) of clause (a) of sub-section (2) of section 5 of the Act was not attracted. 6.. With great respect, I must point out that the reasoning adopted by the learned Member, Sales Tax Tribunal, is fallacious. Firstly, rule 27(2) of the Orissa Sales Tax Rules, on which he has relied, is only a rule of evidence and it does not purport to be exhaust ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... language of the Act nor the language of the rule justifies such an interpretation. It is not the intention in respect of each transaction that matters but the intention as specified in the purchasing dealer's certificate. That intention is declared by the purchasing dealer when he makes an application for registration in Form II and it is incorporated in the certificate granted to him in Form III. These documents are prepared long before any particular transaction of sale is entered into and consequently they have no bearing on the intention with which any particular transaction is entered into between the seller and the buyer. 7.. It was then urged by Mr. Acharya for Messrs S. Lal Co., that a business firm might purchase some quantity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Rules. Such a declaration will undoubtedly be the best proof available to the selling dealer for the purpose of claiming exemption. But even in the absence of such a declaration the substantive right of a party to claim exemption or his liability to pay sales tax will be governed by the provisions of section 5(2)(a)(ii) of the Act. If the conditions mentioned in those provisions are fulfilled a party is either entitled to claim exemption or is liable to pay sales tax. For instance, even though no declaration under rule 27(2) is made by the purchasing dealer, nevertheless if the Sales Tax Department is satisfied from its own papers that the goods sold by the selling dealer to the purchasing dealer were specified in the latter's certifica ..... X X X X Extracts X X X X X X X X Extracts X X X X
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