1974 (12) TMI 66 - HC - VAT and Sales Tax

Issues Involved:
1. Taxation on inter-State sales of raw hides and skins.
2. Validity of G.O. Ms. No. 1094 and Rule 27-A.
3. Right to claim refund under section 15(b) of the Central Act.
4. Impact of amendments to the Central Sales Tax Act.
5. Alleged discrimination under Article 14 of the Constitution.

Detailed Analysis:

1. Taxation on inter-State Sales of Raw Hides and Skins:
The petitioner, a dealer in raw hides and skins, was taxed under the Andhra Pradesh General Sales Tax Act (State Act) for purchases within the state and sought exemption from tax under the Central Sales Tax Act (Central Act) for inter-State sales. The Supreme Court's decision in *State of Mysore v. Lakshminarasimhiah Setty & Sons* held that raw hides and skins were taxable at the purchase point on intra-State sales, and thus, no tax could be levied on inter-State sales under the Central Act. Consequently, the petitioner's inter-State sales were not taxable under the Central Act.

2. Validity of G.O. Ms. No. 1094 and Rule 27-A:
The petitioner argued that the order G.O. Ms. No. 1094 and Rule 27-A of the State Rules could not restrict the statutory right to claim a refund under section 15(b) of the Central Act. This court previously held that G.O. Ms. No. 1094 applied only where transactions attracted tax under both the State and Central Acts, and as the petitioner's inter-State sales did not attract tax under the Central Act, the G.O. was inapplicable.

3. Right to Claim Refund under Section 15(b) of the Central Act:
The court initially ruled that the right to a refund under section 15(b) arose once goods purchased within the state were sold in inter-State trade, without further conditions. However, amendments to the Central Act, specifically section 6(1A) and section 15(b), changed this. The amended section 15(b) required that tax must have been paid under the Central Act on inter-State sales to claim a refund. The petitioner's applications for refunds were rejected as they did not satisfy this condition.

4. Impact of Amendments to the Central Sales Tax Act:
The Central Sales Tax (Amendment) Act (28 of 1969) and later the Central Sales Tax (Amendment) Act (61 of 1972) brought significant changes. Section 6(1A) imposed tax liability on inter-State sales regardless of state tax exemptions. Section 9 validated prior assessments, and section 10 exempted dealers from tax liability for sales between 10th November 1964 and 9th June 1969 if no tax was collected. The 1972 amendment to section 15(b) required payment of tax under the Central Act for refund eligibility, impacting the petitioner's claims.

5. Alleged Discrimination under Article 14 of the Constitution:
The petitioner contended that denying refunds while other similarly placed dealers received them constituted discrimination under Article 14. The court found no merit in this argument, stating that the amended section 15(b) applied uniformly to all dealers. The fact that some dealers received refunds before the amendment did not render the amended provision discriminatory.

Conclusion:
Both contentions raised by the petitioner failed. The court dismissed the writ petitions, noting that the amendments to the Central Act, which came into effect after the petitions were filed, precluded the petitioner's refund claims. Each party was directed to bear its own costs, and the petitions were dismissed.

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