1975 (4) TMI 126 - HC - VAT and Sales Tax

Summary

Issues:
1. Right of the assessee to claim exemption on the turnover of medicinal preparations containing alcohol under the Tamil Nadu General Sales Tax Act, 1959.
2. Claim of exclusion from taxable turnover of the sales tax paid in Maharashtra State on the purchase of tractors.

Analysis:
1. The first issue pertains to the right of the assessee to claim exemption on a turnover of Rs. 45,325.77 related to the sale of medicinal preparations containing alcohol under section 8 read with item 3 of the Third Schedule to the Tamil Nadu General Sales Tax Act, 1959. The Appellate Assistant Commissioner initially rejected a portion of the claimed exemption due to lack of proof of excise duty payment on the specific sum. However, the Tribunal allowed the exemption after the assessee provided evidence of excise duty payment under the Medicinal and Toilet Preparations (Excise Duties) Act, 1955. The High Court, citing previous judgments, held that goods not excise duty paid in the state are not exempt under section 8, leading to the revision petition being allowed in favor of the revenue.

2. The second issue concerns the exclusion of the sales tax paid by the assessee in Maharashtra State on the purchase of tractors from the taxable turnover. The assessee sold tractors in Tamil Nadu after purchasing them in Maharashtra, adhering to the Price Control Order set by the Government of India. The assessing authority sought to include the sales tax paid to Maharashtra in the taxable turnover, but the Tribunal disagreed. The High Court upheld the Tribunal's decision, emphasizing that the sales tax was separately shown and not part of the sale price fixed under the Price Control Order. The Court highlighted that the dealer complied with the Order and charged the fixed price, indicating no intention to include the sales tax in the price of the tractors. Consequently, the revision was dismissed concerning this issue.

In conclusion, the High Court partly allowed the revision petition, setting aside the Tribunal's decision on the turnover related to medicinal preparations but confirming it on other aspects. The Court dismissed the revision in terms of the exclusion of sales tax paid in Maharashtra from the taxable turnover.