ADARSH BHANDAR Vs. SALES TAX OFFICER

JUDGEMENT

(1.) This is a petition under Art. 226 of the Constitution in which the petitioner challenges the validity of an assessment order dated 14th September, 1956, made under the U. P. Sales Tax Act (hereinafter called 'the Act') and of a subsequent notice of demand under the same Act dated 15th September, 1956.

(2.) The petitioner carries on business in Aligarh in vegetable ghee, cloth and sugar and is a registered dealer for the purposes of the Act. On 18th June, 1956, the respondent, who is the Sales Tax Officer, Aligarh, called upon the petitioner to furnish a return of his turnover for the quarter ending 30th June, 1956. The petitioner furnished a return, but he denied that any sales tax could legally be recovered from him on his turnover for this period on the ground that the turnover on the goods in which he dealt was not liable to tax. The respondent, however, by an assessment order dated 14th September, 1956, provisionally assessed the petitioner to a tax of Rs. 75,000 on an estimated turnover of Rs. 12 Lakhs on the ghee, cloth and sugar imported by the petitioner from outside Uttar Pradesh at the rate of one anna per rupee,

(3.) In order to appreciate the principal argument addressed to us it is necessary to refer to certain provisions of the Act. Sub-section (1) of Section 3-A of the Act as it stood prior to the coming into force of the U. P. Sales Tax (Amendment) Ordinance, 1956, empowered the State Government by notification in the official Gazette to declare that the turnover in respect of any goods shall not be liable to sales fax save at such single point as the State Government may specify. Sub-section (2) of this section then provided that if the State Government makes a declaration under Sub-section (1) it may further declare that the turnover of the dealer who is liable to pay tax on the sale of such goods shall, in respect of such sale, be taxed at such rate as may be specified not exceeding one anna per rupee if the sale related to any of the classes of goods specified in the subsection and to be taxed at such rate not exceeding nine pies per rupee if the sale was in respect of other goods.