DAURAM Vs. STATE OF MADHYA PRADESH

JUDGEMENT

(1.) THIS order governs the disposal of Miscellaneous Petition No. 13 of 1959 also. Both these petitions under Articles 226 and 227 of the Constitution have been filed by the petitioner impugning the assessments by the Sales Tax Authorities. The present case refers to the period 1st June, 1947, to nth October, 1948, and the connected case refers to the period 1st November, 1948, to 31st October, 1949.

(2.) THE undisputed facts in these petitions are these. The petitioner is working as a goldsmith. He sells either ready-made ornaments or ornaments made on the orders of customers after purchasing gold from gold dealers. He sometimes prepares ornaments for customers out of the gold supplied by them and adding some of his own gold, if necessary. The petitioner did not get himself registered as a dealer and the Sales Tax Authorities issued a notice to him on 17th May, 1950, to show cause why he should not be prosecuted under Section 8 of the Central Provinces and Berar Sales Tax Act, 1947 (hereinafter referred to as the Act ). He compounded the offence after paying a composition fee. Thereafter, on 20th April, 1951, a notice was issued to him for effecting assessment for the years 1st June, 1947 to 12th November, 1947, 13th November, 1947 to 31st October, 1948, and 1st November, 1948 to 31st October, 1949. As no returns were filed by the petitioner, the Sales Tax Authorities proceeded to assess tax on him on the basis of what is known as "the best judgment assessment".

(3.) SHRI R. K. Pandey for the petitioner contends that the business which the petitioner carried on was only of manufacturing ornaments. He used to purchase gold at the instance of the customers, though the gold vendors used to recover the price thereof from him alone. He asserts that he did not make any profit on the gold used in the ornaments and therefore he did not carry on the business of selling gold. As he was only charging the price for his labour in making the ornaments, he is not liable to pay any sales tax.