FERNANDEZ Vs. STATE

JUDGEMENT

(1.) The petitioner is a registered manufacturer of cocoanut oil and cake who has obtained a certificate of registration in Form VI as provided in sub-r. (i) of R. 20 of the Travancore Cochin General Sales Tax Rules, 1950. Cocoanuts and copra are taxed at the purchase point and according to sub-r.(2) of the said rule a registered manufacturer like the petitioner is entitled to a deduction under Cl.(k) of sub-r.(1) of R.7 equal to the value of the cocoanut and / or copra purchased and converted by him into oil and cake provided that the amount for which the oil is sold is included in his turnover.

(2.) Sales Tax is levied on the net turnover of a dealer and what R.7(1)(k) does is to direct that in determining the net turnover all amounts which a registered manufacturer of cocoanut oil and cake may be entitled to deduct from his gross turnover under R.20 should be deducted in accordance with the conditions specified in that rule. The petitioner has been denied the deduction under R.7(1)(k) read with R.20(2) on the ground that he sold the cocoanut oil manufactured by him not within but outside the State of Travancore Cochin, and his attempt in this petition is to challenge the validity of that denial.

(3.) The main question for determination, therefore, is whether the sale price of the cocoanut oil sold outside the State can be considered as part in his turnover for purposes of the Travancore Cochin General Sales Tax Act, 1125 and, the rules framed thereunder. The relevant portions of the definition of the terms sale and turnover as given in S.2 of the Act read as follows:--