KISHAN PRASAD AND CO LTD Vs. ASSESSING AUTHORITY

JUDGEMENT

(1.) THE Assessing Authority appointed and the East Punjab General Sales Tax Act, 1948, issued two separate notices on 8th February, 1960, to Messrs Kishan Prasad and Co , Ltd. , Ambala, and to Messrs Rup Chand and Co. , Ambala, respectively under Sections 11 and 14 of the said Act, calling upon them to furnish returns for the period commencing on 1st April, 1956, and ending with 31st March, 1957. Both these firms have filed two separate petitions, C. W. 277 of 1960 and C. W. 289 of 1960, under Article 226 of the Constitution challenging the validity of these notices on the ground that their business was not covered by the definition of "sale" given in Section 2 (h) of this Act. As the points raised in both these petitions are same, it will be convenient to decide them by this judgment.

(2.) BOTH these firms carry on the business of hire-purchase of motor trucks at Ambala. The terms on which this hire-purchase is carried on by the petitioning firms are given in their respective petitions. These terms appear to be of similar nature. The petitioners' case is that they are not dealers within Section 2 (d) of the Sales Tax Act inasmuch as they do not sell or purchase any goods in the State of Punjab and further that Explanation (1) of Section 2 (h) of the said Act is invalid, as it does not fall within the scope of item 54 of List 2 of the 7th Schedule of the Contitution of India.

(3.) IT is conceded by the respondents that the petitioners carry on the business of hire-purchase of motor trucks in the State of Punjab and also that the notices under Sections 11 and 14 of the Act have been issued to these firms on the basis of Explanation (1) of Section 2 (h) of the Act. The terms on which this business is carried on are, however, not admitted.