TMI Blog1964 (4) TMI 99X X X X Extracts X X X X X X X X Extracts X X X X ..... required by section 8(4) of the Central Sales Tax Act. The department accordingly took the view that the concessional rate of tax in respect of inter-State sales provided under section 8(1) of the Act would not be available. The sales became accordingly liable to tax under section 8(2)(b) of the Central Sales Tax Act. Having regard to certain provisions of the Madras Prohibition Act, the department levied the tax at the rate of 50 per cent. of the turnover. The petitioner carried an appeal to the Appellate Assistant Commissioner. One of the contentions advanced then was that that provision of the Madras Prohibition Act upon which the department relied in imposing the tax at 50 per cent. was not a sales tax law and therefore the rate specifi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the entire quantity of such goods and not merely on any ingredient which forms part of such goods." If the goods are (sic) exempted by section 8 of the Act, then in so far as the inter-State sales other than of declared goods are concerned, section 8(2)(b) provides that the tax shall be calculated at the rate of 7 per cent. or at the rate applicable to the sale or purchase of such goods inside the appropriate State, whichever is higher. This provision would thus enable a levy of 7 per cent. to be made on such sales. Sub-section (2-A) of section 8 of the Central Sales Tax Act provides that notwithstanding anything contained in sub-section (1) or sub-section (2), if under the Sales Tax Law of the appropriate State the sale or the purchase of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... frontier. "Import" itself has been defined in the Madras Prohibition Act to mean "bringing into the State of Madras otherwise than across a customs frontier as defined by the Central Government." Section 18-A which imposes the excise duty on liquor imported, exported etc., excludes foreign liquor from its scope. It is clear therefore that foreign liquor imported into India is not subject to any duty of excise. If that is so, then the relevant entry in the Third Schedule to the Madras General Sales Tax Act, which exempts liquor, does not cover foregin liquor upon which no duty is leviable. It follows that foreign liquor as such does not stand exempted by the Madras General Sales Tax Act. The initial contention advanced by the learned counse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ointed out, no power to levy a duty of excise. The section reads thus: Every person or institution not being an institution holding a permit under section 20, clause (b) which sells foreign liquor- (a) to any person holding a permit for the consumption of liquor under section 20, clause (a), or (b) to any institution holding a permit for the supply of liquor to its members under section 20, clause (b), shall collect from the purchaser and pay over to the Government at such intervals and in such manner as may be prescribed a sales tax calculated at the rate of 8 annas in the rupee, or at such rate as may be notified by the Government from time to time, on the price of the liquor so sold." Section 20(a) provides for the issue of permi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the general charging section, section 3. Our attention has not been drawn to any provision either in the Madras Prohibition Act or elsewhere which exempts sales of foreign liquor from tax under the Madras General Sales Tax Act. We have been informed by the learned counsel appearing for the department that for reasons which he is not able to state, the sales of foreign liquor have been taxed only under section 21-A of the Act and have not been subjected to tax under the general charging section of the Madras General Sales Tax Act. As far as we can see, there is no warrant for excluding sales of foreign liquor from the operation of section 3 of the Act. Mr. Ramanujam for the department contends that while it may be that sales of forei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he category of sales which falls within the general charging section and distinctly and differently dealt with. Would it be proper then to call that rate applicable to these special classes "the rate applicable to the sale or purchase of such goods inside the appropriate State"? It seems to us that it would not be a proper method of interpretation. We may refer to sub-section (2)(a) of section 8 of the Central Sales Tax Act and the explanation thereto which, in dealing with the Sales Tax Law of the appropriate State, refer to exemption from "tax generally" or subject to "tax generally". The underlying implication therefore is that while there is a general rate of charge imposed by the Sales Tax Law in respect of sales, certain special categ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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