TMI Blog1978 (11) TMI 135X X X X Extracts X X X X X X X X Extracts X X X X ..... urnover was returned and taxed when the sales were made?" The assessee is a dealer in fans, sewing machines and spare parts. For the assessment year 1972-73, they returned before the Assistant Commissioner of Sales Tax, Special Circle, Ernakulam, total and taxable turnovers of Rs. 53,31,654.38 and Rs. 52,02,943.27. Exemption was claimed in respect of a turnover of Rs. 1,28,711.11. The turnover in respect of which exemption was claimed was made up of Rs. 30,311.11, under sales to Indian Naval Services Canteen, and Rs. 98,400 under the sales returns. The first item was allowed, and the second was disallowed on the ground that this was not included in the turnover for the year in question. The year in question was 1972-73. The claim for exem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ril; and the claim for exemption could have been made only subsequent thereto as it was actually made. It appears to us, at the first blush at any rate, to be rather impracticable that the claim should have been negatived on the ground that for the assessment year in question, viz., 1972-73, the turnover in respect of which the exemption was claimed, was not included in the return of assessment. It could not obviously be so included, as the return of the goods itself was only subsequent to the close of the assessment year on 31st March, 1972. 2.. But this view which commends itself to us at the first blush on the language of the rule, and which seems to be supported, as we shall show, by a decision of the Madras High Court and another dec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... explanation. That furnishes the statutory basis for earning exemption from assessment of the turnover or from non-inclusion in the turnover. The mode and the manner of earning the exemption is provided by rule 9(b) of the Rules, which is in discharge of the statutory obligation indicated by clause (ii) of explanation (2). Attention was called by the Government Pleader to the provisions of section 5, which emphasises that every dealer shall pay tax on his taxable turnover for that year. This provision was stressed to emphasise that the scheme of the Act was to make each assessment year the unit of assessment, and to reckon the turnover and exemption with respect to each year of assessment. In the light of these provisions, the learned Gover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in his monthly return for September, 1966. The assessing authority rejected the claim, and the same was confirmed by the Appellate Assistant Commissioner and the Tribunal. Section 13(5) of the Tamil Nadu General Sales Tax Act, as it stood at the relevant time, was as follows: "Where a dealer has refunded the price of articles returned by customers together with the tax collected from such customers in respect of the sale of such articles and where the amount representing the price refunded by the dealer is included in his turnover, the dealer shall be entitled to claim deduction of the tax levied in respect of such sale, within a period of six months from the date of sale by adjustment in the assessment and the final assessment shall be c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , would be eligible for exemption on certain conditions (which need not be noticed). Section 13(5) itself had been amended in 1964. The objects and reasons for the amendment were noticed by the Full Bench and these are significant. The Full Bench examined the scope of rule 5-A(b)(i) with respect to the Division Bench ruling in Madras Radiators and Pressings v. State of Tamil Nadu[1976] 37 S.T.C. 123. and Devi Films (Private) Ltd. v. State of Madras[1961] 12 S.T.C. 274. The decision of the Andhra High Court in State of A.P. v. Vauhini Pictures P. Ltd.[1962] 13 S.T.C. 847. was also noticed. It was observed that though the relevant rule was introduced only in 1973, it made clear the position that no claim for refund or adjustment of the ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gical nor reasonable to insist on a claim for refund being made in the course of the assessment year during which the sale of the goods has been occasioned, when the goods themselves are returned and the claim for refund itself can arise only beyond the assessment year. The view that we take is supported by the two rulings of the Madras High Court in Madras Radiators and Pressings v. State of Tamil Nadu[1976] 37 S.T.C. 123. and Devi Films (Private) Ltd. v. State of Madras[1961] 12 S.T.C. 274., and by the ruling of the Andhra High Court in State of Andhra Pradesh v. Vauhini Pictures P. Ltd.[1962] 13 S.T.C. 847. 6.. We allow this tax revision case and set aside the order of the Tribunal and remand the matter back to the Tribunal for passing ..... X X X X Extracts X X X X X X X X Extracts X X X X
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