KRISHNA TRADING COMPANY Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) HEARD Sri S. Dwarakanath, learned counsel for the revision petitioner and Sri P. Balaji Varma, learned Special Standing Counsel for Commercial Taxes. This revision is directed against the common order of the learned Sales Tax Appellate Tribunal, Andhra Pradesh at Hyderabad (for short, "Tribunal"), dated 24.04.1998 in T.A. No. 606 of 1995 and a batch of five other appeals; insofar as T.A. No. 492 of 1997 is concerned, it was preferred by the revision petitioner against the order of the Deputy Commissioner (Commercial Taxes), Chittoor, revising the order of assessment.

(2.) THE revision petitioner is a dealer, which purchased groundnuts from the Andhra Pradesh Oil Seeds Growers Federation Limited, Hyderabad (for short, "Federation") and on the strength of the certificates issued by the Federation, the assessing authority granted exemption on the corresponding purchase turnover of groundnuts. It requires to be noticed that in G.O. Ms. No. 621, Revenue, dated 28.06.1989, the State exercising powers under Section 9(1) of the Andhra Pradesh General Sales Tax Act, 1957 (for short, "1957 Act"), exempted purchases of groundnut oil seeds by the Federation or its Unions or member farmers under the Oil Seeds Development Project, from the liability to tax under the 1957 Act.

(3.) AGGRIEVED , the revision petitioner preferred an appeal to the Tribunal. Before the Tribunal, the petitioner specifically contended that in view of the earlier decision of the Tribunal in M/s. J.C. Seshaiah Setty and Sons, Kurnool Vs. State of Andhra Pradesh (T.A. No. 439/1993, dated 16.10.1996), if a dealer is to be assessed to tax under Section 6 -A of the 1957 Act (since the Federation is exempted from the liability to tax under Entry 6 of the Schedule III, in view of the exemption granted in G.O. Ms. No. 621, dated 28.06.1989) the revising authority must examine whether the conditions specified under Section 6 -A of the 1957 Act are satisfied i.e., whether the goods purchased from the Federation have been consumed in the manufacture of other goods or consumed otherwise, in other words whether the dealer had converted such groundnuts into oil or sold the groundnuts as such. If the groundnuts as such were sold by the dealer, then he would not be liable under Section 6 -A of the 1957 Act, as the case would fall under the second limb of the provisions in Entry 6 of the Schedule III i.e., purchaser as a last dealer. Despite noting this contention of the petitioner, the Tribunal did not deal with the same but proceeded on the ground that since the bye -laws of the Federation authorize the Federation to pursue the business not only as a miller but also a dealer in oil seeds the exemption under G.O. Ms. No. 621, dated 28.06.1989 would apply only to such turnover of the Federation pertaining to the purchase of groundnuts intended for its milling operations i.e., crushing into oil and not to those purchases of groundnuts meant for resale. For this analysis, the Tribunal relied on the decisions of this Court in M/s. Nabi Oil Mills Vs. Commercial Tax Officer, Chittoor : (1977) 40 STC 118and State of Andhra Pradesh Vs. Lalitha Oil Mills : (1978) 42 STC 169.