SINGH TRADING COMPANY Vs. COMMERCIAL TAX OFFICER SRIKAKULAM

JUDGEMENT

(1.) (Judgment of the Court delivered by the Hon'ble the Chief Justice) 1. Is cashew kernel exigible to sales tax at the point of first purchase in the State when the cashewnut, from which it has been taken out had already been subject to tax under item 12 of the Second Schedule to the A.P. General Sales Tax Act, 1957? This is the question which is uniformly posed in all these 14 cases, both writ petitions as well as tax revision cases.

(2.) Fortunately, there is no dispute in regard to the facts in any one of these matters. All the petitioners are dealers in cashew kernel. They purchased the kernal from dealers who had purchased cashewnut and brought out kernel from it and who had also paid sales tax on the cashewnut purchases since they were the first purchasers in the State. The assessment year is 1974-75 in all these cases. There is now a demand on all these dealers that they should pay tax on their purchases of cashew kernel also. This was resisted by them on the ground that the cashewnut had already suffered taxation but the assessing authorities did not agree with them. The Sales Tax Appellate Tribunal also, when some of the cases were taken to it, declined to accede to the contention of the petitioners. That is how these writ petitions and tax revision cases have arisen.

(3.) The Tribunal and the Sales Tax authorities held the view that kernel is a different commodity from cashewnut and that both of them are liable to be taxed at the point of their first purchases in the State. Indeed, that is the point of view urged before us also by the learned Government Pleader for Commercial Taxes. Learned counsel for the petitioners on the other hand, vigorously argued that cashewnut and kernel are not different commodities and that in fact, in common and commercial parlance, no distinction is made between the two. Therefore, the principal question that will have to be decided is whether cashewnut and kernel mentioned in item 12 of the Schedule are different commodities and are separately taxable.