STATE OF GUJARAT Vs. MEGHDOOT LAMINARD LTD

JUDGEMENT

(1.) THIS is a reference under section 69 (1) of the Gujarat Sales Tax Act, 1969 at the instance of the Revenue. The opponent-dealer is a limited company and it is registered as dealer under the provisions of the Gujarat Sales Tax Act, 1969 (hereinafter referred to as "the Gujarat Act') and also under the provisions of the Central Sales Tax Act, 1956 (hereinafter referred to as "the Central Act ). The opponent-dealer is engaged in the business of manufacturing and selling laminated sheets. The dealer sells the same in Ahmedabad and also outside the State of Gujarat. The dealer effected inter-State sales to the extent of Rs. 9,49,335 during the accounting year commencing from July 1, 1976 to June 30, 1977. It was assessed to tax at the rate of 10 per cent by the Sales Tax Officer as per his order dated August 24, 1979, under the provisions of section 8 (2) (b) of the Central Act.

(2.) THE Assistant Commissioner of Sales Tax (Audit) issued a notice in form 49 and took up the matter in suo motu revision on the ground that the rate of tax collected at 10 per cent should have been enhanced by 6 per cent being the rate of additional tax leviable under section 4a of the Gujarat Act. THE opponent-dealer objected to the notice. After hearing the parties, the Assistant Commissioner held that the Sales Tax Officer had assessed tax on inter-State sales at lower rate. THE tax was, therefore, assessed at the rate of 10. 6 per cent and the amount of tax calculated came to Rs. 1,00,629. 48. Thus an additional demand of Rs. 5,695. 98 was raised. This order was passed by the Assistant Commissioner of Sales Tax on December 12, 1979. THE dealer preferred revision application before the Gujarat Sales Tax Tribunal. THE Tribunal after hearing the parties, as per its judgment and order dated December 10, 1981, allowed the revision application and set aside the order passed the Assistant Commissioner. THE Tribunal restored the order passed by the Sales Tax Officer and also directed that the amount of tax if paid pursuant to the order of the Assistant Commissioner of Sales Tax shall be refunded to the dealer.

(3.) ANALYSING the scheme of section 8, the transactions of inter-State sale would fall under the following five categories : (i) Inter-State sales by a dealer to the Government or to a registered dealer of goods of the description referred to in section 8 (3) shall be at 4 per cent provided the conditions prescribed in section 8 (4) are satisfied. [see section 8 (1)]. (ii) Tax payable by a dealer on his turnover of inter-State sales not falling under sub-section (1) of section 8 and "declared goods" shall be at twice the rate applicable to the sale or purchase of such goods inside the appropriate State. See section 8 (2) (a)]. (iii) Tax payable relating to inter-State sales of other goods (other than declared goods) and not falling under sub-section (1) of section 8 shall be at ten per cent or at the rate applicable for sales inside the appropriate State, whichever is higher. [see section 8 (2) (b)]. (iv) Notwithstanding anything contained in section 8 (1) or section 8 (2) (b), if the goods are sold inter-State, the sale or purchase of which is under the general sales tax law of the State exempt from tax generally or subject to a rate generally at a rate lower than 4 per cent it shall be either exempt from tax or the tax under the Central Sales Tax Act shall be levied at the lower rate as it is obtained in the State. [see section 8 (2a)]. (v) Notwithstanding anything contained in section 8 (1) to 8 (4) of the Act, the State Government, may in public interest and subject to such conditions as may be specified by it, exempt any person from payment of tax regarding the inter-State sales, or levy a rate lower than that specified in section 8 (1) or (2 ). [see section 8 (5)].