1980 (6) TMI 110 - HC - VAT and Sales Tax

Summary

Issues:
Validity of notification exempting purchase turnover of old gold and silver articles from sales tax under section 6 of the Act.

Detailed Analysis:

Issue 1:
The primary issue in this case was whether the notification exempting the purchase turnover of old gold and silver articles from sales tax under section 6 of the Act remained valid after an amendment that increased the tax rate on general goods.

Analysis:
The petitioner, engaged in purchasing old gold and silver articles and manufacturing jewelry, claimed exemption from sales tax under section 6 of the Act due to a notification issued under section 5A of the Act. The assessing authority, appellate authority, and Karnataka Appellate Tribunal had held the petitioner liable for tax under sections 5(1) and 6 of the Act. The Tribunal reduced the tax rate but upheld the assessment. The Tribunal relied on a previous judgment to conclude that the notification was not applicable. The petitioner argued that the notification remained valid under section 8A of the Act. The Court analyzed a similar case where a notification reducing tax rates was deemed invalid after a subsequent amendment. However, the Court disagreed with this interpretation, stating that a notification under section 8A remains valid unless modified or canceled by the State Government. The Court overruled the previous judgment and held that the notification exempting old gold and silver articles from tax remained in force despite the amendment.

Outcome:
The Court concluded that the notification exempting old gold and silver articles from tax was valid and in force, entitling the petitioner to exemption from tax under section 6 of the Act. The orders subjecting the petitioner to tax were set aside, and the petitions were allowed with no costs incurred.