1988 (12) TMI 317 - HC - VAT and Sales Tax

Summary

Issues:
1. Whether the supply and delivery of rice under the Haryana Rice Procurement (Levy) Order, 1979, constitutes a sale attracting liability to tax under the Haryana General Sales Tax Act, 1973.
2. Whether the amendments made to the Haryana General Sales Tax Act, 1973, through Act No. 11 of 1984, validate the levy of sales tax retrospectively.
3. Whether the petitioner is entitled to claim sales tax from the State of Haryana and the District Food and Supplies Controller for the procurement of rice.

Analysis:
Issue 1:
The petitioner sought to quash the assessment order related to the levy of tax on the turnover of rice supplied under the Haryana Rice Procurement (Levy) Order, 1979. The key contention was whether these transactions constituted a sale liable to sales tax. The court analyzed various Supreme Court decisions, including State of Madras v. Gannon Dunkerley & Co. and New India Sugar Mills Ltd. v. Commissioner of Sales Tax, emphasizing the requirement of mutual assent and transfer of property for a transaction to be considered a sale. The court noted the constitutional amendment and the amendment to the Haryana General Sales Tax Act, 1973, which broadened the definition of sale to include transfers not in pursuance of a contract. The court dismissed the petitioner's claim, stating that the levy transactions fell within the ambit of sales tax.

Issue 2:
The court addressed the retrospective operation of the amendments introduced through Haryana Act No. 11 of 1984 to the Haryana General Sales Tax Act, 1973. It highlighted the validity of retrospective imposition of sales tax by referring to the decision in Hira Lal Rattan Lal v. Sales Tax Officer, Kanpur. The court rejected the argument that the transactions did not constitute sales even after the amendments, citing prior judgments and upholding the applicability of sales tax to the levy transactions.

Issue 3:
Regarding the petitioner's claim for sales tax payment from the State of Haryana and the District Food and Supplies Controller, the court held that since the procurement price fixed under the Haryana Rice Procurement (Price Control) Order, 1968, was inclusive of sales tax, the petitioner had no legal basis to claim sales tax from the respondents. The court dismissed the writ petition, stating that there were no grounds for interference and ordered no costs to be awarded.

In conclusion, the court dismissed the writ petition, upholding the liability of the petitioner to pay sales tax on the transactions under the Haryana Rice Procurement (Levy) Order, 1979, for the assessment year 1984-85.