TMI Blog1973 (6) TMI 49X X X X Extracts X X X X X X X X Extracts X X X X ..... he manufacture of other goods for sale or otherwise; or (b) disposes of such goods in any manner other than by way of sale in the State; or (c) despatches them to any place outside the State except as a direct result of sale or purchase in the course of inter-State trade or commerce." 3.. Several arguments were urged before the learned single judge and those may be grouped under five heads: (1) The object sought to be achieved by the introduction of section 5A of the Act had not been accomplished because the section is vague. (ii) Assuming that the section is clear enough and can be treated a charging section, the section imposes a tax not on the sale or purchase of goods but on its use or consumption. The State Legislature has no competency to impose tax on the use or consumption of goods and so the section is ineffective. (iii) The provision in section 5A infringes the guarantee under article 301 of the Constitution that commerce and intercourse throughout the territory of India should be free. (iv) As far as the appellant in Writ Appeal No. 51 of 1972 (petitioner in O.P. No. 145 of 1971) is concerned no tax could be imposed on him because none of the conditions und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied in the First or Second Schedule, at the rates and only at the points specified against such goods in the said Schedules; and (ii) in the case of other goods, at the rate of three per cent at all points of sale: Provided that every dealer in cooked food including coffee, tea and like articles served in a hotel, restaurant or any other place, whose total turnover in respect of such food is not less than one lakh rupees shall pay tax at the rate of four per cent on his taxable turnover. (2) Every dealer other than a dealer referred to in sub-section (1) whose total turnover for a year in respect of the goods specified in the First or Second Schedule is not less than two thousand five hundred rupees shall pay tax at the rate and only at the point specified against the goods in the First or Second Schedule, as the case may be, on his taxable turnover in that year relating to such goods: Provided that where a tax has been levied under sub-section (1) or sub-section (2) of this section or under section 5A in respect of the sale or purchase of goods specified in the Second Schedule and such goods are sold in the course of inter-State trade or commerce, the tax so levied shall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... x. Explanation-In sub-section (5) and sub-section (6), the word 'containers' includes gunny bags, tins, bottles or any other containers." It was argued that any tax can be imposed under the Act only if section 5 is satisfied. This was so before section 5A was introduced. Under this section sales of certain goods regarding which no tax was payable before the introduction of the section though the sale or purchase of such goods were generally taxable under the Act, were also made taxable in the hands of the dealer purchasing those goods provided the conditions of the section were satisfied. It is not possible to accept the argument that section 5A is subject to section 5. So what has to be ascertained is whether the sales of the particular goods are generally taxable under the Act and not whether the particular sales of those goods are taxable. The question to be posed is whether the Act imposes a tax on the sale or purchase of the goods which have been purchased by a dealer. If the Act purported to tax the sale or purchase of such goods, the further question may arise whether in given circumstances such sales could or could not be taxed. Our attention was drawn to the decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ales tax is dealt with by the Supreme Court in M/s. J.K. Jute Mills Co. Ltd. v. State of Uttar Pradesh and Another[1961] 12 S.T.C. 429 (S.C.); A.I.R. 1961 S.C. 1534. We shall extract a passage from that judgment: "But it is urged on the strength of certain observations in Province of Madras v. Boddu Paidanna and Sons' that a sales tax is a tax on the occasion of sale, and that therefore it could not be imposed with retrospective operation. This contention is, in our judgment, wholly without substance. Now, the point for decision in that case was whether a tax imposed by a Provincial Legislature on the sale of oil by a person who manufactured it was bad on the ground that it was in essence an excise duty. While a sales tax could be imposed by a Provincial Legislature, an excise duty could be imposed only by the Federal Legislature. In holding that the tax in question was a sales tax and not an excise duty, the court observed as follows: 'The duties of excise which the Constitution Act assigns exclusively to the Central Legislature are, according to the Central Provinces case[1938] 1 S.T.C. 1 (F.C.); A.I.R. 1939 F.C. 1; [19391 F.C.R. 18. (In the matter of Central Provinces and Be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted. Though at one time it was thought that a levy of tax will never have the effect of interfering with the right guaranteed under article 301 of the Constitution, long years ago it has been established that a levy of tax can also in given circumstances interfere with the right guaranteed under article 301 of the Constitution. But it is not every form of tax which can be said to infringe the right guaranteed under article 301. It is only discriminatory tax by which the sales or purchases of goods of the State imposing the tax are dealt with one way and similar transactions of goods from another State are dealt with in a different way, that will attract the article. These propositions were established by the decisions of the Supreme Court in Atiabari Tea Co. Ltd. v. The State of Assam and Others[1961] 1 S.C.R. 809., Firm A.T.B. Mehiab Majid and Co. v. State of Madras and Another[1963] 14 S.T.C. 355 (S.C.) A.I.R. 1963 S.C. 928. and Andhra Sugars Ltd. and Another v. State of Andhra Pradesh and Others[1968] 21 S.T.C. 212 (S.C.) A.I.R. 1968 S.C. 599. In Firm A.T.B. Mehtab Majid and Co. v. State of Madras and Another[1963] 14 S.T.C. 355 (S.C.) A.I.R. 1963 S.C. 928., the tax imposed was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sional order of assessment for the year 1970-71. We have not got the details as to the exact process employed and we do not think the High Court is called upon in proceedings under article 226 of the Constitution to investigate the various facts and to come to the conclusion on the question as to what is the process adopted by the dealer. This must be left to the authorities under the statute and nothing prevents the appellant from urging these contentions before these authorities. The appellant in Writ Appeal No. 51 of 1972 may do so. If these contentions are urged before the Sales Tax Officer, he must deal with them and after considering all the relevant facts, pass a reasoned order in accordance with law. We leave the question open as far as this court is concerned. 12.. The only remaining point in the case is whether pine-apple is a green vegetable, which fell under item 10 in the Third Schedule to the Act. Item 10 is in these terms: "10. Vegetables (other than green ginger), whether roots, green fruits or leaves, used for human consumption including tapioca, yam, potatoes, lime, sabola and tomatoes, except their manufactured products." The argument that was advanced befo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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