CHIRANJILAL GHHAGANLAL Vs. DEPUTY COMMISSIONER OF COMMERCIAL TAXES

JUDGEMENT

(1.) These four writ petitions are directed against the assessment orders under the Bihar Sales Tax Act, 1959, for the periods 1973-74, 1974-75, 1975-76 and 1976-77, wherein the common question involved is, whether outside the State, purchase of declared goods, which have not borne purchase tax in the State of Bihar, sale of such declared goods within the State of Bihar, are liable to the payment of sales tax.

(2.) The petitioners are dealers in kirana, gur, oil-seeds, chillies, etc. Petitioner No. 1 is a firm of which the other two petitioners are partners. Petitioner No. 1 is a registered dealer both under the Bihar Sales Tax Act, 1959, as well as under the Central Sales Tax Act, 1956, having certificate of registration under the State Act, bearing No. S.G. 468(1)(R) and under the Central Act bearing No. S.G. 253(C). They have also applied for registration under the Bihar Sales Tax Ordinance, 1976. In order to carry on their trade and business, they purchase goods, both within the State of Bihar as also outside the State of Bihar. In this writ petition, we are concerned with the purchases of declared goods made from outside the State of Bihar. In the impugned assessment orders, the petitioners have been charged to pay sales tax on the sale of those declared goods which have been purchased outside the State of Bihar, to registered dealers within the State of Bihar. The amount of purchase of the declared goods from outside the State of Bihar is not in dispute. What is being disputed is that no sales tax is at all leviable on its sale in the State of Bihar, they being declared goods under Section 3A of the Bihar Sales Tax Act, 1959, irrespective of the purchase of those declared goods from outside the State of Bihar or within the State of Bihar. In short, the declared goods under Section 3A are immune from the payment of sales tax.

(3.) Section 3A of the Bihar Sales Tax Act, 1959 was introduced with effect from 1st May, 1966, by Section 11 of the Bihar Finance Act, 1966. This section was amended on 1st November, 1970, by the Bihar Sales Tax (Amendment) Ordinances of 1970 and 1971. Section 3A has further been amended by the Bihar Finance Act, 1981, with which provision we are not concerned in the present cases. Section 3A at the relevant time read as follows :