THE SOUTHERN INDIA TEA ESTATES COMPANY, LTD. Vs. THE AGRICULTURAL INCOME TAX AND SALES TAX OFFICER, PEERMADE

JUDGEMENT

(1.) THESE are appeals,by the petitioners in O.P.Nos.1315,1316 and 1317 of 1959 against the dismissal of those petitions.The only question for consideration is whether they are liable to pay a licence fee during the period from 1st October 1957 to 1st April 1958 under rule 21 of the General Sales Tax Rules,1950,as contended by the respondents,and held in the common judgment under appeal.

(2.) RULE 21 as substituted by a notification,dated 28th September 1957 and published in the Kerala Gazette Extraordinary,No.108,dated 30th September 1957,provides that every person who deals in goods specified in Schedule I of the Act or in goods partly exempted by notification under section 6 shall,in case the turnover of any such person in any year in respect of the goods mentioned above is not less than Rs.7,500,submit an application in Form VIII for a licence in respect of each of his places of business.Form VIII specifies the goods as: "all other goods exempted under sub -section(vii)of sec­tion 5 and partly exempted by notification under section 6 of the Act.''

(3.) SECTION 5(vii)of the Act provides that the sale of goods specified in column 2 of Schedule I shall be liable to tax only at such single point in the series of sales by successive dealers as may be specified by the Government by notification in the Gazette,and that where the taxable point so specified is a point of sale,the seller shall be liable for the tax on the turnover for which the goods are sold by him at such point and where the taxable point so specified is a point of purchase,the buyer shall be liable for the tax on the turnover for which the goods are bought by him at such point.The relevant notifica­tion specified that the taxable point in respect of tea shall be the first sale in the State by a dealer who is not exempt from taxation under section 3(3)of the Act.The conten­tion of the appellants is that they are dealers not exempt from taxation under section 3(3 ),that they effect the first sale in the sale,that they have paid sales -tax at the Agricultural taxable point specified in the notification and as they have derived no benefit whatsoever,they cannot be compelled to pay and obtain a licence under rule 21 of the General Sales Tax Rules,1950.In other words,their contention is that the stipulation for a licence in rule 21 is only a condition precedent to the earning of a benefit and as the appellants derived no benefit,they do not belong to the class of persons who are expected to pay the licence fee.