NARESH CHANDRA GHOSE Vs. STATE OF BIHAR

JUDGEMENT

(1.) These there references under the Bihar Sales Tax Act have been heard analogously. The assessee in all these cases is Dr. Naresh Chandra Ghose, and the facts are also similar. The assessee carries on business of manufacturing and selling Ayurvedic, medicines under the name and style of "Sadhana Ausadhalaya". In Miscellaneous Judicial Case No. 388 of 1957, the assessment of sales tax upon the petitioner is for the periods 1952-53 and 1953-54. He was assessed on a total taxable turnover of Rs. 1,92,878 in 1952-53 and of Rs. 1,93,626 in 1953-54. He claimed a deduction of Rs. 36,180/8/- in the first year and Rs, 39,829 in the second year on account of sale of Mritasanjibani Sura. His claim was founded upon Notification No, STGL-60/51-4280 F.T. dated 2-4-1951, by which, in exercise of the powers conferred by Section 6 of the Bihar Sales Tax Act. 1947 (Bihar Act XIX of 1947), the Governor of Bihar was pleased to direct that the goods mentioned therein will be exempt from payment of sales tax subject to the conditions and exceptions, if any set out in the corresponding entry in the third column thereof. One of the goods extempted from sales tax is country liquor, as mentioned in item 10 of the said Notification. The assessee raised an objection before the Sales Tax Officer, before the Assistant Commissioner of Sales Tax, before the Deputy Commissioner of Commercial Taxes under Section 24 of the Bihar Sales Tax Act, 1947 (hereinafter referred to as the Act) and also before the Board of Revenue that there was no liability to pay sales tax on the amount of sale proceeds fetched by sale of Mritasanjibani Sura on the ground that it was a country liquor. This contention was rejected by all these authorities. At the instance of the assessee the Board of Revenue has submitted the following question of Jaw for the opinion of the High Court under Section 25(1) of the Bihar Sales Tax Act (Bihar Act XIX of 1947) in Miscellaneous Judicial Case 388 of 1957:

(2.) In his applications to the Board of Revenue under S. 25 of the Bihar Sales Tax Act, 1947 the assessee had asked for reference to the High Court of several questions of law, but only one of them, as stated above, was referred by the Board. Being aggrieved by and disatisfied with the said order of the Board the assessee filed two applications before this Court under Sections 25(2) and 25(4) of the Act in respect of assessments for two different periods to direct the Board of Revenue to state a case and refer the questions mentioned therein to the High Court for opinion. Those applications are numbered as Miscellaneous Judicial Cases 320 and 321 both of 1957. These applications were allowed, and as directed by the High Court, the Board of Revenue has stated a case upon the following common question of law in both the cases. "Where on the facts and circumstances of the case Mritsanjibani Sura is exempt from Sales Tax.

(3.) There is no substantial difference between the aforesaid questions. What, in effect, we are called upon to answer is whether Mritsanjibani Sura is exempt from Sales Tax. On behalf of the assessee Mr. P.R. Das put forward the argument that the Sales Tax authorities were not legally right in including the sale proceeds of Mritsanjibani Sum in the taxable turn-over of the assessee & the assessment of Sales Tax thereon was illegal. In support of his contention he relied upon Notification No. STGL 607 51-4280 F. T. dated 2-4-1951, referred to above, by which the goods mentioned therein were exempted from Sales Tax with effect from 1-4-1951. Item 10 of this notification is relevant for the present purpose and is in the following terms: