STATE OF ORISSA Vs. PHIPSON AND CO LTD

JUDGEMENT

(1.) ORIGINALLY the Orissa Sales Tax Tribunal under section 24 (1) of the Orissa Sales Tax Act, 1947 (hereinafter referred to as "the Act") framed the following two questions and referred the same to this Court for opinion :

(2.) DURING the pendency of this application, section 24 of the Act came to be amended by virtue of which the said pending application has been registered as tax revision.

(3.) A bare reading of the entry 30 of the tax-free list shows that sale of goods to the military personnel by the defence service installations is only exempted but the Tribunal took the view that if the sales effected to defence organisation is taxed, the ultimate tax burden will be on the military personnel which they have to pay while effecting purchases of such goods from defence service installations in which case it would defeat the purpose of the provision granting exemption. The Tribunal accordingly held that the sale transaction is to be exempted from payment of sales tax. On careful consideration of the submission of the counsel, we are of the opinion that the view taken by the Tribunal in the matter cannot be faulted with. The aforesaid interpretation stands confirmed by the Government in the Finance Department notification dated February 8, 1999 which reads as follows :