STATE OF ANDHRA PRADESH Vs. BLUE STAR LIMITED

JUDGEMENT

(1.) In this tax revision case filed under section 22(1) of the Andhra Pradesh General Sales Tax Act, 1957 (for short "the State Act") by the State, the turnover of the respondent was assessed to sales tax under the State Act for the assessment years 1972-73, 1973-74 and 1974-75. Now we are concerned with the assessment in respect of the assessment year 1974-75. The assessee is a dealer in electronic goods. It imported certain goods from United States of America for Defence Research Laboratories. In some of the transactions, the goods were directly handed over to the Defence Research Laboratories and in other cases they were routed through the Director of Supplies and Disposals. Before the assessing authority, the assessee urged that as the transactions fall under sub-section (2) of section 5 of the Central Sales Tax Act, 1956 (for short "the Central Act"), the turnover relating to those transactions cannot be taxed under section 38(ii) of the State Act. This plea was not accepted both by the assessing authority as well as the appellate authority. However, on further appeal, the Sales Tax Appellate Tribunal allowed the appeal of the assessee holding that the transactions fall under section 5(2) of the Central Act.

(2.) The short question that arises for consideration in this revision is whether the turnover of the assessee in respect of the transactions in question is exempted from tax in view of the provisions of section 38(ii) of the State Act.

(3.) It would be useful to read section 38 of the State Act which is in the following terms :