1998 (9) TMI 552 - SC - VAT and Sales Tax

Whether the High Court was corect to conclude that Tribunal had been right in granting exemption to the respondent on the turnover of bakery products amounting to Rs. 1,94,076, which was less than Rs. 2 lakhs? Held that - Appeal allowed. The High Court was in error. The notification as originally issued gave an exemption in respect of the tax payable by a dealer on the sales of, inter alia, bakery products. The amendment restricted the operation of that exemption to a dealer whose total turnover in a year did not exceed Rs. 2 lakhs. The emphasis was on the total turnover of the dealer and that would include not only the dealers turnover in bakery products but also such turnover in other articles as the dealer might have. Such total turnover of the respondent being over Rs. 2 lakhs, it was not entitled to the exemption.

Summary

The Supreme Court judgment stated that a dealer's total turnover, including bakery products, exceeding Rs. 2 lakhs made them ineligible for tax exemption under a state government notification. The High Court's decision to grant exemption to a dealer with turnover less than Rs. 2 lakhs was overturned, and the appeal was allowed with no costs.