TMI Blog1998 (12) TMI 588X X X X Extracts X X X X X X X X Extracts X X X X ..... to collect sales tax in respect of the turnover of rice supplied to the said Corporations. 3.. Writ Petition Nos. 7102 of 1985 and 7103 of 1985 were filed claiming the same relief for the assessment years 1984-85 and 1985-86 respectively. 4.. The writ petitions came up before a Bench consisting of the then acting Chief Justice and another learned Judge. Relying on the judgment of the Supreme Court in Vishnu Agencies (Pvt.) Ltd. v. Commercial Tax Officer [1978] 42 STC 31, the learned Judges dismissed the writ petitions on the ground that the said turnover is liable to tax. 5.. The petitioner, therefore filed Civil Appeal Nos. 967 to 969 of 1986 before the Supreme Court. The Supreme Court granted special leave and set aside the order in the writ petitions and remitted the matters to the High Court with a direction to restore the writ petitions to its file and dispose of the same on the limited issue of the question as to whether the Andhra Pradesh Rice Procurement See Sri Dhanalakshmi Kanyaka Parameswari Rice Mill v. Commercial Tax Officer [1986] 63 STC 168 (AP). (Levy) Order, 1984 (for short the Order ) left any scope for bargaining or not applying the ratio of the decision of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (Sales Tax) Act, 1941. The Supreme Court held that a transaction which is effected in compliance with the obligatory terms of a statute may nevertheless be a sale in the eye of law. Compulsory acquisition of property would exclude the element of mutual assent, which is vital to a sale, but so long as mutual assent, express or implied is not totally excluded in a transaction, it will amount to a sale . While holding as above, the learned Judges had referred to the judgment in Chittar Mal s case [1970] 26 STC 344 (SC) and observed that this decision is clearly distinguishable since the provisions of the Wheat Procurement Order were construed by the court as being in the nature of compulsory acquisition of property, obliging the dealer to supply wheat from day to day. Cases of compulsory acquisition of property by the State stand on a different footing since there is no question in such cases of offer and acceptance nor of consent, either express or implied . In other words, the Supreme Court agreed with the view in Chittar Mal s case [1970] 26 STC 344 that the procurement of wheat under the procurement order is in the nature of compulsory acquisition. However, by agreeing with the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... leness, it would be open to the parties to fix the time of delivery. Paragraph 8A which confers on the allottee the right to ask for weighment of goods also shows that he may reject the goods on the ground that they are short in weight just as indeed, he would have the undoubted right to reject them on the ground that they are not of the requisite quality. The circumstance that in these areas, though minimal, the parties to the transactions have the freedom to bargain militates against the view that the transactions are not consensual. 9.. In other words, if there is a scope, though minimal, for bargain, then the transactions are consensual and not compulsory acquisitions. 10.. Let us now examine whether the Rice Procurement Order provides for any scope for bargaining purpose. 11.. Clause 3(c) of the Order says that every licensed miller shall sell to the Food Corporation/State Corporation at the procurement price fifty per cent of the total quantity of each variety of rice conforming to specifications purchased or otherwise acquired by him for the purpose of sale from persons other than a licensed miller or a licensed dealer. From this clause, it is clear that the prices ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the licensed dealer has the right to dispute the correctness of the result of the analysis of the variety of rice procured by the Government. In other words, if the miller or the dealer is of the view that the rice supplied is of particular specification, that the price should be of that specification and that the report given by the analyst is not acceptable to him, he can raise a dispute within a particular period. On such dispute having been raised, there is an obligation on the purchase officer to get the sealed sample of rice retained by him analysed once again and the view of the analyst is binding on both the parties. 14.. In view of the observations made in Vishnu Agencies case [1978] 42 STC 31 (SC) referred to above, there is a minimal scope to bargain as regards the variety of rice procured by the Government. Since there is minimal scope for bargaining, it cannot be said that mutual assent, express or implied, is totally excluded. Therefore, in view of clause 6 of the Procurement Order enabling the licensed miller or the licensed dealer to raise a dispute as to the correctness of the analyst s report, we are of the view that it is a sale and not compulsory acquisitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an at the mill premises or the business premises of the miller or dealer, he shall be entitled to other charges incidental to such delivery, including transportation charges as regulated by the Government from time to time. The incidental charges is a matter for bargain and negotiations between the parties though transportation charges may be regulated by the Government. 22.. Rice is also classified as common, fine and superfine as per Schedule III giving length and breadth of the rice and there is possibility of bargaining or negotiating so far as the classification of the rice also is concerned. It is also relevant to mention columns 4 to 6 of Schedule V and they read as under: 4. Inorganic foreign matter shall not exceed 0.5 per cent in any lot of rice. If it is more the stocks should be cleaned and brought within the limit. 5.. If the red grains in begmi rice are beyond rejection limit, the stock may not be rejected but millers offering such stock should repolish and bring the same within the same rejection limit. 6.. In case of par boiled rice, prepared by pressure par boiling technique it will be ensured that correct process of par boiling is adopted, i.e., pressur ..... X X X X Extracts X X X X X X X X Extracts X X X X
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