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1990 (6) TMI 215 - HC - VAT and Sales Tax
Issues:
- Interpretation of the proviso to section 2 of the Tamil Nadu Additional Sales Tax Act, 1970 regarding the inclusion of turnover relating to "declared goods" in taxable turnover for the purpose of fixing the rate of tax. Analysis: The judgment addressed two tax cases concerning the levy of additional sales tax for the assessment years 1976-77 and 1977-78, focusing on whether the turnover of "declared goods" should be included in the taxable turnover under section 2 of the Act for determining the tax rate. The assessing officer initially proposed to levy tax based on the turnover of general goods only but later included the turnover of declared goods to fix the taxable turnover, leading to objections from the assessee. The Appellate Assistant Commissioner and Sales Tax Appellate Tribunal upheld the assessment orders, prompting the filing of tax revisions. The main contention was whether the inclusion of declared goods turnover violated the proviso to section 2 of the Act. The petitioner argued that including declared goods turnover was contrary to the proviso, while the Additional Government Pleader contended that no additional tax was levied on declared goods turnover. The Court examined section 2 of the Act, emphasizing that the levy of additional tax applies when the taxable turnover exceeds a certain threshold, and the proviso restricts the additional tax rate for declared goods. The Court concluded that although the turnover of declared goods was considered for determining taxable turnover, it was not subjected to additional tax exceeding the prescribed rate. Therefore, the inclusion of declared goods turnover for fixing the tax rate on general goods turnover was permissible under the Act and did not violate the proviso to section 2. In the final decision, the Court found no error in the Tribunal's order and dismissed the tax cases without costs, affirming that the inclusion of declared goods turnover in the taxable turnover for rate fixation did not contravene the Act's provisions.
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