P A RAJU CHETTIAR Vs. STATE OF MADRAS

JUDGEMENT

(1.) THESE two second appeals arise out of a suit, O.S. No. 112 of 1947, on the file of the Court of the Subordinate Judge of Coimbatore, brought for the recovery of a sum of Rs. 2, 995-6-3 alleged to have been wrongfully collected as sales tax. The plaintiff is a registered partnership firm carrying on business as jewellers and merchants in gold and silver bullion and specie in Coimbatore. For the year 1944-45, the Deputy Commercial Tax Officer, Coimbatore, assessed the plaintiff firm to sales tax on a turnover of Rs. 51, 22, 169-12-3 in respect of the plaintiff's main shop and a turnover of Rs. 5, 27, 890-0-3 in respect of the plaintiff's branch shop dealing with sliver. There was an appeal by the plaintiff to the District Commercial Tax Officer and applications in revision to the Board of Revenue at Madras. There was a partial reduction in the assessable turnover. The plaintiff alleged that as per the final orders of the Board of Revenue a sum of Rs. 1, 34, 790-2-9 in the turnover of the branch shop and a sum of Rs. 1, 64, 749-2-0 in the turnover of the main shop, making a total of Rs. 2, 99, 539-4-9 had been wrongly assessed to a tax amounting to Rs. 2, 995-6-3. It is for the recovery of this amount of sales tax alleged to have been wrongfully collected that the suit was instituted. The total sum of Rs. 2, 99, 539-4-9 comprised three items in dispute : 1.Rs. 1, 13, 967-9-6 and Rs. 61, 837-12-0 being the value of silver bullion supplied from the branch shop and the main shop respectively to certain manufacturers of silverware and silver jewellary at Kumbakonam for being made into finished ware. The said supplies of silver were treated by the sales tax authorities as sales of bullion by the plaintiff firm to the Kumbakonam merchants. The plaintiff's contention was that the transactions were not sales at all within the meaning of the term 'sale" in the General Sales Tax Act, but were only supplies of raw material for conversion into finished products for wages only.

(2.) A sum of Rs. 20, 823-9-3, alleged to have been wrongly included in the turnover of the branch shop.