1992 (9) TMI 312 - HC - VAT and Sales Tax

Summary

Issues:
Interpretation of tax liability on khesari dal under Orissa Sales Tax Act, 1947.

Analysis:
The case involved a dispute regarding the tax liability on khesari dal under the Orissa Sales Tax Act, 1947. The dealer claimed exemption on the sale of khesari dal, stating it was tax-free under serial No. 30-D of the tax-free list. However, the assessing officer considered the goods taxable at 4% under serial No. 27 of the list of goods subject to sales tax. The Tribunal concluded that khesari dal was liable to tax on the turnover of purchases under section 3-B of the Act. The Tribunal also considered the applicability of section 15(d) of the Central Sales Tax Act, 1956, which treats certain pulses as a single commodity for tax purposes. The Tribunal remanded the matter to determine the turnover of purchases made inside the State for assessment.

The Revenue contended that khesari dal should be taxed under serial No. 7 of the list of goods liable to tax on purchase turnover, not under serial No. 27 of the list of goods subject to sales tax. The relevant provisions indicated that khesari or khesari dal is taxable at 4% at the purchase point under serial No. 7 read with section 15(d) of the Central Sales Tax Act. The Tribunal's conclusion that khesari dal is taxable on the purchase turnover was upheld, and the approach of remanding the matter for assessment of purchases made inside the State was deemed appropriate.

The Court held that khesari dal falls under serial No. 8 (previously serial No. 7) of the notification issued under section 3-B of the Act and is liable to tax on the purchase turnover if the dealer is the first purchaser inside the State. The Tribunal's decision not to consider the goods as cattle-feed due to the dealer's concession rendered the second aspect of the question academic. The judgment favored the assessee and ruled against the Revenue, with no costs awarded. Both judges concurred with the decision, and the reference was answered accordingly.