TMI Blog1992 (12) TMI 209X X X X Extracts X X X X X X X X Extracts X X X X ..... question involved in these writ petitions, it would be sufficient to refer to the facts stated in the affidavit filed in W.P. No. 10254 of 1987. The petitioners are rice and flour mills. It is stated that the mills do only milling business and they do not purchase or sell paddy or rice or any of the products of paddy or rice. They charge Rs. 3 to Rs. 5 per bag for milling the paddy and converting it into rice. After the paddy is converted into rice, the owner of the rice takes away the rice and its by-products. It is stated that the petitioners are small rice millers and their business is treated as cottage industry and that they have taken necessary permits and licences under the Rice Milling Industry (Regulation) Act, 1958. That Act, it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and husk obtained during the process of milling and were getting consideration for the same. It is stated that when it was noticed that the mills were doing this type of business without obtaining registration certificate from the Commercial Tax Department, notices were issued to them on May 14, 1987 asking them to get themselves registered under section 12(3) of the Act. It is also stated that as they are effecting sales of bran and husk, which are taxable under item No. 58 of the First Schedule to the Act, they are liable to pay sales tax and hence they fall within the definition of a "dealer" by doing the business of sale of bran and husk. Therefore, it is stated, they must get themselves registered under section 12(3) of the Act. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fter filing the writ petition. Sri Rajeswara Rao, the learned Senior Counsel, submits that in view of the provisions of the Rice Milling (Regulation) Act, 1958, section 12(3) is ultra vires of the State Legislature. He further contends that the petitioners are not dealers; the business of rice milling cannot be taxed and hence they cannot be obliged to get themselves registered. It is also stated that the very purpose requiring the petitioners to get themselves registered is to impose tax on them as without registration no sales tax can be levied. Sri Dhananjaya, the learned counsel for the petitioner in W.P. No. 8590 of 1991 adopts the arguments of Sri Rajeswara Rao. The learned Government Pleader for the respondents contends that the im ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... This declaration is made under entry 52 of List I of the Seventh Schedule to the Constitution, which is in the following terms: "Industries, the control of which by the Union is declared by Parliament by law to be expedient in the public interest." The effect of the said declaration is that to the extent the Central legislation governs the field, the power of State Legislature is taken away. (See State of Orissa v. M.A. Tulloch and Co. AIR 1964 SC 1284). The impugned State legislation is enacted under entry 54 of List II of the Seventh Schedule to the Constitution. The entry reads: "Taxes on the sale or purchase of goods other than newspapers, subject to the provisions of entry 92-A of List I." The entry in question deals with taxes ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cometax [1960] 40 ITR 605 (SC)]. Here it will be useful to refer to the judgment of a Division Bench of our High Court in N. Pullayya v. Government of Andhra Pradesh [1968] 21 STC 291. In that case validity of section 12-A(1)(b) of the Act was questioned. The said provision reads as follows: "a miller who is not a wholesale dealer or a retail dealer shall also get himself registered under this Act. " The Division Bench held that the said provision was meant to check evasion of sales tax and if so it was valid. In the instant case also the contention of the respondent is that it is meant to check evasion of tax inasmuch as the power of Legislature extends to enacting provisions to prevent evasion of tax. We have no doubt that the impug ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ear is less than Rs. 50,000 registration is optional. A combined reading of section 12 of the Act and the definition of the "dealer" makes it clear that if a dealer is not registered he does not escape tax liability. The liability to pay the tax does not depend upon registration of a person as a "dealer" under the Act as such, but on fulfilment of the requirements of section 5 of the Act. Whether the petitioner or the members of the petitioners-association are doing business in husk or barn is a question of fact which has to be determined by the authorities under the Act. In so far as the petitioners are concerned, the matter stands only at the stage of notice requiring them to register under section 12(3) of the Act. At this stage the li ..... X X X X Extracts X X X X X X X X Extracts X X X X
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