TMI Blog1995 (4) TMI 265X X X X Extracts X X X X X X X X Extracts X X X X ..... Taxation Tribunal Act, 1987, enacted under article 323B of the Constitution conferring exclusive jurisdiction in the subject-matter and incidental and ancillary matters in this Tribunal, to the exclusion of the High Court. In short, the case of the applicant-company is that it is registered as a dealer under the 1941 Act and the 1956 Act and it manufactures for sale M.S. pipes and tubes and cold rolled strips, etc., by purchasing H.R. strips as raw material from respondent No. 4, Steel Authority of India. It also purchases for manufacturing purpose coal from respondent No. 5, Eastern Coalfields Limited. It pays sales tax at 2 per cent on its purchases by furnishing declaration forms to the selling dealers. The raw materials purchased an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avit-in-opposition was filed by respondents Nos. 4 and 5, but respondent No. 5 was represented at the hearing by Mr. D.K. Dhar, learned advocate. No one, however, appeared for respondent No. 4. The case of respondents Nos. 1 to 3, the State taxing authorities, in their affidavit-in-opposition, is that if the turnover tax is properly computed, the impugned provisions will not be invalid or unconstitutional or in contravention of section 15 of the 1956 Act. The provisions are valid, because sales tax is levied at 2 per cent and turnover tax is levied at 2 per cent, bringing the total rate of tax to 4 per cent. Moreover, rule 3(2A)(6) of the Bengal Sales Tax Rules, 1941, subsequently referred to as "the 1941 Rules", ensures that not more than ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ngs the total amount of tax to Rs. 4.04 or at 4.04 per cent on the basic price of any declared goods, the relevant provision becomes violative of section 15(a) of the 1956 Act. By referring to section 6B(2)(a) of the 1941 Act, Mr. Chakraborty, appearing for the applicant, submitted that the State Legislature intended that levy of tax should not be in excess of the rate mentioned in section 15(a) of the 1956 Act. He was supported by Mr. D.K. Dhar, learned advocate for respondent No. 5, who said that respondent No. 5 has been realising turnover tax at 2 per cent upon sale price inclusive of sales tax at 2 per cent, thus bringing the total tax rate to 4.04 per cent, as calculated on behalf of applicant in the illustration already mentioned. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e power of the State to levy tax, should be strictly construed so that by no means the State may contravene the provision in any manner. At the time section 15 of the 1956 Act was enacted, turnover tax was not yet introduced. It was introduced with effect from April 1, 1979. It is now settled that turnover tax is nothing but sales tax in another name and in another form. Both sales tax and turnover tax are imposed on the authority derived from entry 54 of List II of the Seventh Schedule to the Constitution. Therefore, when section 15(a) of the 1956 Act restricts the rate of tax to not exceeding 4 per cent, it applies to the total tax whether levied as sales tax or turnover tax. Therefore, for interpretation of "sale or purchase price" for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e 3(2A)(6) or by virtue of the proviso to section 6B(3) of the 1941 Act or by virtue of other provisions of the 1941 Act and the 1941 Rules governing the computation of sales tax and turnover tax, sufficient relief is given so that the dealer is not required to pay tax including turnover tax at an effective rate exceeding 4 per cent, in that case the validity and constitutionality of sections 6B(2)(a) and 6B(3)(a) of the 1941 Act will be duly maintained. Otherwise, the validity and constitutionality thereof will be at stake. In order to save the validity of the said provisions and to make the same duly conform to section 15(a) of the 1956 Act and article 286(3) of the Constitution, we direct respondents Nos. 1, 2 and 3 to employ the proviso ..... X X X X Extracts X X X X X X X X Extracts X X X X
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