C S KRISHNA IYER Vs. OFFICIAL LIQUIDATOR

JUDGEMENT

(1.) THE short question to be decided in these revisions relates to the interpretation of S. 8 (2a) of the Central Sales Tax Act of 1956 (for short the Central Act ).

(2.) FACTS which gave rise to these revisions can be stated briefly in the following lines:

(3.) IN order to understand the true scope of S. 8 (2a) of the Central Act, a reference to S. 6 (1 A) of that Act would be useful. That section reads thus: "a dealer shall be liable to pay tax under this Act on a sale of any goods effected by him in the course of inter-state trade or commerce notwithstanding that no tax would have been leviable (whether on the seller or the purchaser) under the sales tax law of the appropriate State if that sale had taken place inside that State. " The material provision, S. 8 (2a) reads thus: "notwithstanding anything contained in sub-section (1a) of S. 6 of in sub-section (1) (or clause (b) of sub-section (2) of this section, the tax payable under this Act by a dealer on his turnover in so far as the turnover or any part thereof relates to the sale of any goods, the sale or, as the case may be, the purchase of which is, under the sales tax law of the appropriate State, exempt from tax generally or subject to tax generally at a rate which is lower than (four per cent) whether called a tax or fee or by any other name), shall be nil or, as the case may be, shall be calculated at the lower rate. EXPLANATION; For the purpose of this sub-section a sale or purchase of any goods shall not be deemed to be exempt from tax generally under the sales tax law of the appropriate State, if under that law the sale or purchase of such goods is exempt only in specified circumstances or under specified conditions or the tax is levied on the sale or purchase of such goods at specified stages or otherwise than with reference to the turnover of the goods. " That sub-section was not in that form before an amendment brought to it as per Act 61 of 1972. Since both sides have argued much on the implications of the said amendment, and since the Appellate Tribunal has also sought to place significance on this amendment, we would reproduce here that subsection as it stood before the said amendment. "notwithstanding anything contained in sub-section (1a) of S. 6 or sub-section (1) or sub-section (2), of this section if under the sale tax law of the appropriate State the sale or purchase, as the case may be, of any goods by a dealer is exempt from tax generally or is subject to tax generally at a rate which is lower than (three per cent) (whether called a tax or fee or by any other name), the tax payable under this Act on his turnover in so far as the turnover or any part thereof relates to the sale of such goods shall be nil or, as the case may be, shall be calculated at the lower rate. Explanation: For the purpose of this sub-section a sale or purchase of goods shall not be deemed to be exempt from tax generally under the sales tax law of the appropriate State if under that law it is exempt only in specified circumstances or under specified conditions or in relation to which the tax is levied at specified stages or otherwise than with reference to the turnover of the goods. "