INDIAN CABLE CO LTD Vs. STATE OF BIHAR

JUDGEMENT

(1.) THIS is a reference under section 25(1) of the Bihar Sales Tax Act (Act XIX of 1947). The assessee is a limited company, Messrs. Indian Cable Co., Ltd. It was assessed to sales tax by the Superintendent of Sales Tax, Jamshedpur, under section 13(2)(b) of the said Act for the year 1950-51. The gross turnover of the assessee was determined at Rs. 2,05,85,205-10-6 which consisted of four categories of sales price, namely, (1) Rs. 35,55,358-4-0 representing goods sold and delivered to consumers outside Bihar for their direct consumption, (2) Rs. 57,11,316-11-6 representing goods sold and delivered to dealers outside Bihar for sales to consumers in those places, (3) Rs. 1,01,54,907-15-0 representing sales of goods made by the company's agents or secretaries at Calcutta, Madras, Delhi, Coimbatore, Karachi, Lahore and other places and (4) the rest representing goods sold to dealers in Bihar. The taxable turnover was determined at Rs. 2,01,19,980 out of which the amount of Rs. 1,91,59,760 was assessed at three pies per rupee and the rest, namely, the amount of Rs. 9,60,220-15-0 was assessed at six pies per rupee. The total assessment came to be Rs. 3,29,378-2-0. The applicant claimed a deduction on account of goods sold outside Bihar covered by the first three categories of sales price referred to above. The Superintendent of Sales Tax, however, refused to make a deduction of the above amount. The assessee then filed an appeal before the Commissioner of Commercial Taxes which was heard by the Deputy Commissioner of Sales Tax. He accepted the contention of the assessee with regard to the first category of sale and, therefore, allowed a deduction of the amount covered by that item. With respect to the second category of sale, he held against the assessee. With respect to the third category of sale, he held that if the amount actually represented sale price of goods lying from before in stock with the appellants' agents at Calcutta etc., the amount could not obviously be considered after the 26th of January, 1950, to be its turnover within the meaning of the Bihar Sales Tax Act for the purpose of the present assessment. On this finding he remanded the case to the Superintendent of Sales Tax for verification and exclusion of the amount from assessee's gross turnover if it is found to be correct. The assessee thereafter filed a revision application before the Board of Revenue but the application was not admitted. The assessee filed an application before the Board of Revenue for making a reference to this Court on certain questions of law. It may be noted that the assessee also filed a review petition against the order of the Board of Revenue refusing to admit the revision application. At the time of hearing, however, the review application was withdrawn and the assessee pressed his application for reference on questions of law to this Court. This application was allowed and the following questions have been referred for the decision of this Court. They are :-

(2.) IT has been submitted by the counsel of both the parties that the first question has not been accurately formulated and accordingly this question is recast as under :-

(3.) AN explanation is attached to this clause which runs as follows :-