RALLIS INDIA LIMITED Vs. STATE OF TAMIL NADU

JUDGEMENT

(1.) BOTH these cases related to the same subject-matter. Messrs. Rallis India Limited, Madras, is the petitioner in both. For the assessment year 1966-67, it was assessed under the Madras General Sales Tax Act, 1959, to a taxable turnover of Rs. 2, 31, 63, 560. The said taxable turnover included a sum of Rs. 16, 70, 044. 55 being the turnover on last purchase of cotton within the State. The petitioner objected to the inclusion of the said turnover contending that, cotton being declared goods when it is sold inter-State, the tax levied and collected under the madras General Sales Tax Act, 1959 (hereinafter called the State Act), has to be refunded under section 4-A of this Act, that, therefore, once the said declared goods are sold inter-State, there cannot be a levy and collection on the last purchase of those declared goods for, even if the levy and collection is made it has to be refunded later and that the levy and collection of the central sales tax on the inter-State Act, which the assessee is statutorily entitled to under section 15 (b) of the Central Sales Tax Act, 1956 (hereinafter called the Central Act ). These contentions of the assessee had been rejected by the assessing authority.

(2.) AGAINST the order of assessment so far as it relates to the turnover on last purchase of cotton, an appeal was filed before the appellate Assistant Commissioner. That appeal, however, failed. The assessee took the matter on appeal to the Sales Tax Appellate Tribunal. The Tribunal held that the assessment so far as it relates to the turnover on last purchase of cotton within the State under section 4 cannot be challenged and that the claim for refund of the tax paid on that turnover is not sustainable as it has not fulfilled the conditions imposed by the provisions of rule 23 (1) of the madras General Sales Tax Rules, 1959. AGAINST the order of the Tribunal the assessee has filed T. C. No. 11 of 1971 under section 38 of the State Act. The assessee has also filed the above writ petition seeking a writ of mandamus to the respondent to refund the sum of Rs. 33, 400. 89 being the tax collected from them for the year 1966-67 on the turnover of last purchase of cotton within the state. Thus, the two questions that arise in these cases are : (1) whether the assessee is liable to pay tax on its last purchase of cotton within the State under section 4 and (2) whether the assessee is entitled to the refund of Rs. 33, 400. 89, the tax paid on its last purchase of cotton within the State without showing that it has paid the Central sales tax on the same goods. So far as the second question is concerned, it is true that the Tribunal relied on rule 23 (1) of the Tamil Nadu General Sales Tax rules, 1959, in support of its view that the assessee is entitled to a refund only if it has paid to tax under the Central Act and, naturally, the assessee has challenged the validity of that rule. But in view of the amendment to section 15 (b) with retrospective effect from 1st October, 1958, by Central Act 61 of 1972, the petitioner is not entitled to claim refund of tax paid under the state Act as he has not admittedly paid the Central sales tax on the inter-State transactions in the same goods. In view of this change in the law it is unnecessary to go into the validity of the said rule.

(3.) WE are also not inclined to accept the assessee's contention that at all events there can be only one levy on declared goods. It is true that section 15 of the Central Act contemplates declared goods suffering tax only at one stage but that section itself specifically contemplates more than one levy on declared goods and refund being made in respect of tax levied at all other stages except the one levied under the central Act. This position is made clear in the decision of this court in sitalakshmi Mills Ltd. v. Deputy Commercial Tax Officer where it has been pointed out that section 15 provides that the State Government may levy a tax on declared goods at any stage under local laws but only on conditions that if the goods were sold in the course of inter-State trade or commerce the tax, if any, collected on the local sale of such goods has to be refunded. Therefore, the petitioner's extreme contention that there can be only one levy on the declared goods under the Central Act and that they cannot be brought to charge at all under the State Act cannot at all be sustained. The result is the tax case and the writ petition are dismissed with costs. Casual's fee Rs. 250 each.