1979 (11) TMI 248 - HC - VAT and Sales Tax

Summary

Issues involved: Appeal against Board of Revenue order under section 7-A of Madras General Sales Tax Act, 1959 for purchase of goods from agriculturists and export to foreign countries.

Summary:
The appeal was filed against the Board of Revenue's order taxing the turnover under section 7-A of the Act. The assessing officer had determined the taxable turnover based on the purchase of goods from agriculturists and their subsequent export to foreign countries. The Appellate Assistant Commissioner initially cancelled the assessment under section 7-A, but this decision was reversed by the Supreme Court in a previous case. The Board then initiated revision proceedings and taxed the turnover under section 7-A(1)(c) of the Act. The main contention was whether the despatch of goods to a place outside the State would attract purchase tax under section 7-A. The Court held that clause (c) of section 7-A applies when goods are despatched outside the State, regardless of their destination. The Court referred to a Supreme Court decision regarding sales tax on goods delivered to aircraft proceeding abroad, emphasizing that the despatch to a place outside the State suffices for tax liability under section 7-A. The Court clarified that the exception for inter-State trade or commerce did not apply in this case, thus upholding the tax levy under section 7-A. The judgment did not impact the amendment made by Central Act 103 of 1976. The appeal was dismissed with costs.