TMI Blog1998 (3) TMI 647X X X X Extracts X X X X X X X X Extracts X X X X ..... 31, 1991 in the light of entry 57 of the First Schedule to the Kerala General Sales Tax Act and the exemption notification which came into force from August 1, 1991? Is the Tribunal justified in law in taking the view in the present case that when reckoning the turnover of an assessee for a particular period, the liability of tax is to be determined on the basis of his turnover for the complete assessment year? (ii) Whether, on the facts and in the circumstances of the case, has not the Appellate Tribunal committed an error in relying on the decision of this honourable Court in S. Koder Agencies v. State of Kerala [1993] 89 STC 528 which was laid down in a different context altogether? 2. The relevant facts are as follows: Revision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... does not exceed the taxable limit, i.e., Rs. 20 lakhs, liability of tax is to be determined after considering the turnover for whole year. 4.. Learned counsel for the assessee contended that the Tribunal has committed an error in following the decision of this Court in S. Koder Agencies v. State of Kerala [1993] 89 STC 528. That decision was rendered under section 5(2A) of the Kerala General Sales Tax Act wherein liability is imposed for paying turnover tax. From the wording of section 5(2A)(i) itself, it was clear that the limit of Rs. 25 lakhs was fixed in respect of the total turnover in a year. On the other hand, under entry 57 of the First Schedule, it is not mentioned that the turnover of Rs. 25 lakhs and above in respect of hot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l Sales Tax Rules, 1963 would clearly show that the liability to pay tax has to be assessed, taking into consideration the turnover for the entire financial year. If that be so, the turnover in respect of the hotel business of the assessee would be above Rs. 20 lakhs and the assessee can be granted exemption only with effect from August 1, 1991, namely, the date on which S.R.O. No. 1003 of 1991 came into force. Relying on a decision of the Supreme Court in State Level Committee v. Morgardshammar India Ltd. [1996] 101 STC 1, learned Government Pleader further contended that the provisions in a taxing statute granting exemption are to be construed strictly. Under these circumstances, according to learned Government Pleader, there was no error ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le to the Act. It is also admitted that exemption from tax granted in respect of sale of cooked food including beverages sold or served in all hotels and restaurants other than bar attached and star hotels and restaurants, came into force with effect from August 1, 1991. The contention raised by the assessee is that since exemption has been granted with effect from August 1, 1991, the quantum of turnover of the assessee for the period from April 1, 1991 to July 31, 1991 and the turnover for the period from August 1, 1991 to March 31, 1992 are to be separately computed for the purpose of examining the question whether the assessee is liable to pay tax at all under entry 57 of Schedule I. According to the assessee, the turnover for the abovem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r be his total turnover for the year . Section 5A relates to levy of purchase tax. A reference to clause (c) of sub-section (1) of section 5A, sub-section (2) of section 5A, the proviso thereto and sub-section (3) would also make it clear that wherever turnover is mentioned, it is turnover for the year . Even though, in the definition of the term turnover , there is no reference to the period with respect to which it has to be computed, rule 18 is very clear that the assessee has to file a return showing the total turnover and taxable turnover for the preceding year and the amounts by way of tax or taxes due on the taxable turnover during the year . Since year is defined under section 2(xxx) as financial year, it is the duty of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r has to be taken into account to find out whether the assessee is liable to pay tax under entry 57 of the First Schedule. 9.. Surcharge is an increase on the tax payable by the dealer whose turnover exceeds the limit. The surcharge was not to be computed on the basis of the turnover. It was for this reason, in Deputy Commissioner of Sales Tax (Law), Board of Revenue (Taxes), Ernakulam v. K.P. Paper Products [1989] 74 STC 16, this Court took the view that if the amount of tax and additional tax computed is eligible for complete exemption, there cannot be a levy of surcharge for that year. Thus, the above decision is of no help to the assessee in the present case. 10.. Therefore, we hold that the Tribunal has correctly placed reliance on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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