COMMISSIONER OF SALES TAX Vs. DEVI GHULAM KANPUR

JUDGEMENT

(1.) THIS is a reference under section 11(1) of the U.P. Sales Tax Act submitted by the Judge (Revisions) Sales Tax, Lucknow, for the opinion of this Court on the following question of law :

(2.) THE assessee who carries on business in foodgrain at Kanpur, applied for exemption under rule 20-B of the U.P. Sales Tax Rules in respect of its turnover of foodgrain for the assessment year 1956-57. The turnover of foodgrain on which, according to the assessee, the exemption fee was payable was a sum of Rs. 25,000. The Sales Tax Officer, however, did not accept the figure of turnover and assessed the same at Rs. 75,000 and demanded a sum of Rs. 750 as exemption fee. The assessee appealed. A preliminary point was raised that as the assessee had failed to deposit even the admitted exemption fee of Rs. 150, the appeal was not maintainable in view of the first proviso to section 9 of the Act which reads as follows :

(3.) MR . R. M. Sahai, learned counsel for the Commissioner, urged that the exemption fee is nothing but a capitalised tax and in support of this contention he relied upon a decision of this Court in Firm Ram Prasad Banwari Lal v. Sales Tax Officer, Moradabad ([1959] 10 S.T.C. 48; A.I.R. 1958 All. 878.). It is not necessary, however, to go into that question as we are of opinion that assuming that exemption fee is a capitalised tax, the same cannot be regarded as tax levied under an assessment order contemplated by section 9. We are, therefore, of opinion that it was not necessary for the assessee to have deposited the exemption fee before his appeal could be entertained against the order of exemption. We, therefore, answer the question in the negative in favour of the assessee and against the Commissioner. The assessee is entitled to his costs which we assess at Rs. 100. Reference answered in the negative.