1970 (10) TMI 66 - HC - VAT and Sales Tax

Summary

Issues:
- Exemption from sales tax under Notification No. ST-4485/X dated 14th December, 1957
- Interpretation of statutory provisions regarding exemption criteria
- Application of the Additional Duties of Excise (Goods of Special Importance) Act, 1957

Analysis:
The judgment by the High Court of Allahabad pertains to the entitlement of exemption from sales tax under Notification No. ST-4485/X dated 14th December, 1957. The court addressed the issue raised by the Additional Judge (Revisions) regarding the assessee's eligibility for exemption from sales tax on sales of imported mill-made cloth for a specific period. The respondent, a mill-made cloth dealer, contended that his turnover was exempt by virtue of the mentioned notification. The court examined the legislative background, particularly the Additional Duties of Excise (Goods of Special Importance) Act, 1957, which aimed to substitute sales tax with an additional excise duty on specific goods. The notification in question required proof of payment of additional excise duty for exemption under section 4(1)(b) of the U.P. Sales Tax Act.

In analyzing the statutory provisions, the court emphasized that the notification intended to exempt only goods subject to additional excise duty. The court distinguished a previous Supreme Court decision where unconditional exemption was granted for goods not attracting additional excise duty. The court highlighted the importance of satisfying the conditions set forth in the notification for claiming exemption. It was clarified that the exemption was limited to goods meeting the criteria of payment of additional excise duty and proof of such payment to the assessing authority.

Further, the court compared the current case with a previous judgment involving the exemption of biris from sales tax, where the turnover was not exempt due to the absence of additional excise duty. Applying similar reasoning, the court concluded that the mill-made cloth sold by the assessee did not fall within the scope of the Additional Duties of Excise Act, thus rendering the exemption claimed invalid. The court held that the assessee was not entitled to the exemption as the turnover of the cloth was not covered by the notification criteria. Consequently, the court answered the reference questions accordingly, denying the exemption claimed by the assessee.

In conclusion, the court addressed the issues of exemption from sales tax under the specified notification, interpreted the statutory provisions governing the exemption criteria, and applied the provisions of the Additional Duties of Excise Act, 1957 to determine the eligibility for exemption. The judgment clarified the conditions for claiming exemption and highlighted the necessity of meeting the specified criteria for exemption under the relevant legislation.