POKHARDAS MEGHRAJ Vs. STATE OF BOMBAY

JUDGEMENT

(1.) These are a group of rules in which a common question of law relating to sales tax arises for determination. The petitioners are dealers within the meaning of the sales tax law and they have all been assessed to general tax for the period 1st November, 1952, to 31st March, 1953, and 1st April, 1953, to 31st March 1954. The assessment for the first of these two periods is governed by the Sales Tax Ordinance No. 3 of 1952 and the Bombay Sales Tax Rules, 1952, made thereunder. The assessment for the second period is governed by the Bombay Sales Tax Act, 1953. The provisions of the Ordinance, in so far as they are relevant for the purpose of disposing of these petitions, have been reproduced verbatim in the 1953 Act; and the Bombay Sales Tax Rules, 1952, were continued in force by section 49 of the Act of 1953. Therefore, it is unnecessary to refer separately to the provisions of the Ordinance and the Rules made thereunder and the provisions of the Act of 1953 and the Rules which were applicable to cases falling under that Act. Taking the relevant provisions of the Act of 1953, we have first a definition of "dealer" given in section 2(6) which before the Act was amended by subsequent legislation read "dealer" means any person who carried on business of selling goods in the State of Bombay". Then there is in sub-clause (2) a definition of "turnover of sales" and turnover of sales means "the aggregate of the amounts of sale price received and receivable by a dealer in respect of any sale of goods made during a given period." Section 5 of the Act subjects turnover to a general tax. Then action 7 provides how the taxable turnover shall be determined and it is in these terms :

(2.) Therefore, under section 7(i)(b) there is power conferred on the State of Bombay to prescribe by rates for a deduction from the turnover for the purpose of calculating the taxable turnover. Under this section the relevant rule with which we are concerned is rule 5 and the relevant parts of it with these petitions are concerned are as follows :- "Deduction of certain sales is calculating taxable turnover under section 7. - (1) In calculating the taxable turnover of a dealer under section 7 of the turnover of the following sales may be deducted under clause (i)(b) of that section :-

(3.) It will, therefore, be seen that by reason of the proviso to rule 5(1)(vii) as well as rule 5 (xi) (II) the purchase price shall be included in the taxable turnover of the purchasing dealer under certain circumstances.