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TMI Blog1962 (1) TMI 48X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax Act, 1956, which came into force on 1st July, 1957, these transactions have become liable to be taxed. They have held that a portion of the turnover, i.e., Rs. 34,839-77 is liable to be taxed under section 8(2) and the remaining portion of the turnover, i.e., Rs. 86,577-49 is liable to be taxed under section 8(1) of that Act. We may mention at this stage that the latter portion of the turnover is covered by 'C' forms, as required by sub-section (3) of section 8. We have had occasion to consider the scope of section 8(2) in C.R.P. No. 964 of 1961*. Therein we have opined that the liability of a dealer, excepting *Since reported as Yadalam Lakshminarasimhiah Setty & Sons v. State of Mysore [1962] 13 S.T.C. 583. as regards the minimum turn ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the lower rate, as the case may be" (underlining is ours)*. The dispute in this case centres round the interpretation to be placed on the words "the sale or purchase of any goods by a dealer is exempt from tax generally and not in specified cases or in specified circumstances. " According to the learned Government Pleader the words "exempt from tax generally" refer to "goods" which were the subject-matter of sale or purchase. But according to Sri Bhat, the learned counsel for the petitioner, those words refer to the sale transaction referred to in section 8(1). In other words, the contention of the Government Pleader is that unless the goods that are the subject-matter of sale or purchase are totally exempt from tax under the appropriate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods which are the subject-matter of the transactions in question are exempt from taxation, e.g., may be a second sale inside the State in respect of certain goods. The question for consideration now is under which category the exemption mentioned in the proviso comes. It was not argued that the exemption in question has any reference to the dealer, though such a contention, if it had been raised, could not have been unceremoniously brushed aside. The relevant portion of the clause says that "the sale or purchase of any goods by a dealer is exempt from tax generally." If the reference is to a dealer the expression "the sale" is incongruous. Further if it had referred to the dealer mentioned in section 8(1) it would have been appropriate t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inter-State trade or commerce. Hence, prima facie, the proviso must also deal with such sales. It may also be noted that before the word "sale" found in the proviso there is the definite article "the". "The sale" must refer to some definite sale and not to any indefinite transaction in any goods, "The sale" must necessarily refer to the sale contemplated in subsection (1) of section 8. It cannot refer to any and every sale of goods. Further after the words "the sale or purchase of any goods by a dealer" and before the words, "exempt from tax generally", the verb used is "is" and not "are", which means that the verb refers to "the sale or purchase" and not to "goods." If it had referred to "goods" the verb used should have been "are". Which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he last purchase transaction of certain goods inside the State which is intended for sale in the course of inter-State trade or commerce was exempt from taxation. Now, under the proviso to section 8(1) it appears that the benefit of that exemption is extended to the related inter-State sale transaction. That is why the Legislature is likely to have used the words "or purchase" after the word "sale" in the proviso. It is true, that the language used in the proviso could have been happier. The Parliament should have made its intention clear by appropriate words. Economy in words does not always add to clarity, nor words of uncertain import like the words "exempt generally" make the task of Courts easy. For the reasons mentioned above, we agre ..... X X X X Extracts X X X X X X X X Extracts X X X X
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