GEORGE OAKES PRIVATE LIMITED Vs. STATE OF MADRAS

JUDGEMENT

(1.) These are two appeals on certificates granted by the High Court of Madras and consolidated by its orders dated March 22, 1957. They are from the judgment and orders of the said High Court dated April 20, 1956 and July 30, 1956 in two Tax Revision Cases, by which the High Court dismissed two petitions filed by the appellants under S. 12 B of the Madras-General Sales Tax Act (Madras Act IX of 1939), hereinafter called the principal Act., in the following circumstances.

(2.) M/s George Oakes (Private) Limited, appellants herein, are dealers in Ford motor cars, spare arts and accessories. For the two years 1951-52 and 1952-53 the appellants submitted their returns under the relevant provisions of the principal Act and claimed exemption from tax which regard to certain amount realised on transactions of sales which the appellants contended were inter State sales and hence exempt from tax under Art 286 of the Constitution as it stood at the relevant time. The Deputy Commercial Tax Officer, Madras, not only rejected the claim of exemption, but added to the turnover certain amounts which the appellants had collected by way of tax. The amounts so added for 1951-52 were- (a) Rs. 8,000/- to the net turnover assessable at 3 pies per rupee, and (b) Rs. 4,30,000/- to the turnover assessable at 9 pies per rupee. For 1952-53 the amounts so added were - (a) Rs. 30,132,000 add (b) Rs. 2,92,257 add respectively.

(3.) Aggrieved by the orders of the Deputy Commercial Tax Officer, the appellants preferred two appeals to the Special Commercial Tax Officer, Appeals, Madras City. These appeals were dismissed. The matter was then taken to the Sales Tax Appellate Tribunal by means of two appeals. By this time the Madras Legislature had passed the Madras General Sales (Definition of Turnover and Validation of Assessments) Act, 1954 being Madras Act No. XVII of 1954. This Act we shall refer to as the impugned Act in this judgment, because its constitutional validity is now the only question for decision these appeals. The Tribunal negatived the claim of the appellants arising out of the contention that some of the sale transaction in the relevant years were in effect inter-State sales and therefore exempt from tax; the tribunal declined to go into the second question of the constitutional validity of the impugned Act. We may state here, though nothing now turns upon this that the Tribunal held that when sales tax was included in the turnover, it was proper to tax the amounts so included at the minimum rate only, viz., 3 pies in the rupee under S. 3 (1) of the principal Act.