TOOLS AND MACHINERIES Vs. STATE OF MADRAS

JUDGEMENT

(1.) THE assessee is the petitioner in this tax revision case. It is a private limited liability company which was carrying on business in auto-parts and accessories. During the assessment year 1952-53, with which this petition is concerned, the assessee returned its turnover as nil. The Deputy Commercial Tax Officer, however, estimated its turnover at Rs. 96713-8-0 this being the amount for which the goods held by it including its furniture were handed over to a proprietary consent by name Associated Trades. This transaction took place on 2-4-1932.

(2.) THE contention raised on behalf of the assessee before the Deputy Commercial tax Officer was two-fold. The first was that as the stock in trade which the assessee had and which was sold to the Associated Trades was in discharge of liabilities due to this concern it was not a sale by a dealer in the course of his business and therefore did not attract the tax liability as not being a sale within the definition under the Madras General Sales Tax Act. The second contention that it raised was that it was exempted from "tax under rule 5 (1) (h) of the Turn over and Assessment Rules. This rule exempts from inclusion in the turnover of an assessee "all amounts realised by the sale of a dealer of his business as a whole. "

(3.) THE Deputy Commercial Tax Officer rejected both these grounds for exemption and assessed the turnover we have mentioned above to tax under the General sales Tax Act. The assessee took the matter in appeal to the Commercial Tax officer. The appellate authority confirmed the assessment but in the order which it passed it did not refer specifically to the first of the grounds which we have mentioned above. It dealt merely with the claim for exemption under Rule 5 (1) (h)of the Turnover and Assessment Rules and held that as the assessee did continue in business, it could not be stated that there was "a sale of its business as a whole. " on this ground the exemption claimed under Section 5 (1) (h) was rejected and as we stated before the other point about the transaction of sale not being within the act was not dealt with by it. It confirmed, the assessment ordered by the Deputy commercial Tax Officer. The assessee took the matter in further appeal to the tribunal and in the order of the Tribunal also the only point dealt was in relation to the exemption wider Rule 5 (1) (h) of the Turnover and Assessment Rules. The Tribunal affirmed the decision of the lower authorities, and held the exemption not applicable to the case of the assessee. It is from this order that the present revision case has been filed.