1980 (9) TMI 262 - HC - VAT and Sales Tax

Summary

Issues involved: Interpretation of statutory provisions under section 7-A of the Tamil Nadu General Sales Tax Act, 1959 regarding taxation of amounts paid for timber and bamboos purchased from the forest department.

Summary:
The High Court of Madras, in a revision petition, addressed the failure of the Tamil Nadu Sales Tax Appellate Tribunal to consider the real controversy between the parties and the specific statutory provisions. The assessee purchased timber and bamboos from the forest department for manufacturing rayon silk, with a value of Rs. 90,525 paid to the forest department and additional charges of Rs. 2,00,990.56 for transport and extraction. The Appellate Assistant Commissioner and the Tribunal did not adequately apply section 7-A of the Act in determining the tax liability. The Court clarified that the transport and extraction charges were not subject to tax under the Act, as they were not part of the consideration for obtaining the coupe. The Court set aside the Tribunal's order, remanding the matter for fresh consideration solely regarding the Rs. 90,525 value of the coupe for tax liability assessment, emphasizing the need to address the controversy raised by the parties.

In conclusion, the High Court allowed the petition, setting aside the Tribunal's order and remanding the matter for reconsideration solely concerning the tax liability of the Rs. 90,525 value of the coupe, excluding the transport and extraction charges from taxation under the Act.