1987 (9) TMI 388 - SC - VAT and Sales Tax

Whether there were any subsequent sales effected by the assessee which would become chargeable under the proviso to section 9(1)? Held that - Appeal allowed. As it would be clear that this aspect of the issue between the parties was not gone into by the High Court in the view that it took that the proviso was only applicable in the case of registered dealers. Now that statute has been amended with full retrospective effect to include the case of unregistered dealers as well it is necessary to examine the facts of the case and examine whether the provisions of the new proviso are applicable thereto. We therefore set aside the judgment of the High Court and remand the matter to the High Court for fresh disposal of the writ petitions in the light of the above discussion and in accordance with law.

Summary

Issues:
Interpretation of provisions of the Central Sales Tax Act, 1956 regarding tax liability on inter-State sales by an unregistered dealer.

Analysis:
The judgment by the Supreme Court involved four appeals from the Allahabad High Court concerning the interpretation of the Central Sales Tax Act, 1956, related to the case of M/s. Coal Coke Supplies Corporation of Kanpur. The appeals focused on the tax liability of the assessee for the assessment years 1967-68, 1968-69, 1969-70, and 1970-71 under section 9(1) of the Act.

The assessee contended that the transactions in question gave rise to inter-State sales taxable in the State of origin, Bihar or West Bengal, and that no sales tax was leviable as there were no subsequent sales as per the proviso to section 9(1). The High Court's decision was based on the premise that unregistered dealers were not liable to tax under the Central Sales Tax Act, citing previous rulings.

The Sales Tax Officer argued that certain transactions involved the assessee acting as a dealer effecting subsequent sales, attracting liability under the proviso to section 9(1) of the Act. The court noted the amendment to the proviso, making it applicable to unregistered dealers as well, with full retrospective effect from 1976.

The Supreme Court held that the High Court's judgment should be set aside and remanded for fresh consideration in light of the amended statute. The court emphasized the need to examine the facts of the case to determine the applicability of the new proviso to the assessee's transactions. Both parties were granted the opportunity to present their contentions and factual positions through affidavits before the matter was reconsidered by the High Court.

In conclusion, the appeals were allowed, with no order as to costs, and the case was remanded to the High Court for fresh disposal considering the amended provisions of the Central Sales Tax Act, 1956.