1987 (11) TMI 350 - HC - VAT and Sales Tax

Summary

Issues: Liability of petitioner under Central Sales Tax Act for assessment years 1974-75 and 1975-76.

The judgment by the Orissa High Court dealt with two writ applications concerning the liability of the petitioner under the Central Sales Tax Act for the assessment years 1974-75 and 1975-76. The petitioner, a Forest Utilisation Officer in Bihar, was involved in supplying sleepers to the Union of India as per an agreement between the Government of Bihar and the Ministry of Railways. The petitioner had previously been assessed under the Orissa Sales Tax Act, which was later overturned by the High Court and Supreme Court. The petitioner argued that since the transaction did not amount to carrying on business under the State Act, there should be no liability under the Central Act. The petitioner also contended that Orissa was not the appropriate situs for imposing sales tax under the Central Act.

The Court referred to a previous decision involving a similar question under the Central Sales Tax Act, where it was held that the Forest Officers were not considered "dealers" as the transactions were not for profit but to fulfill an obligation to the Central Government. The Court noted the amended definition of "dealer" under the Act, which included Governments as dealers except for specific circumstances. However, the Court found that the amendment came into force after the relevant assessment periods, and therefore, the previous decision applied to the present cases. The Court concluded that the petitioner did not carry on any business in the supply of sleepers and was not liable to be assessed under the Central Sales Tax Act for the relevant years. Consequently, the writ applications were allowed, and the assessment orders were quashed with no order as to costs. The judgment was agreed upon by both judges, and the writ applications were allowed.