1996 (2) TMI 506 - HC - VAT and Sales Tax

Summary

Issues:
1. Claim for exemption in assessment year 1976-77.
2. Validity of claim for exemption on goods returned in assessment year 1975-76.
3. Entitlement to refund of sales tax paid.
4. Interpretation of relevant provisions of the Tamil Nadu General Sales Tax Act, 1959.
5. Application of the decision in Traders and Traders v. State of Tamil Nadu [1977] 40 STC 289 (Mad.) [FB].
6. Consideration of rule 5B of the Tamil Nadu General Sales Tax Rules, 1959.
7. Taxation of goods at a single point.
8. Double taxation on the same goods.
9. Applicability of the decision in Peico Electronics & Electricals Ltd. v. State of Tamil Nadu [1990] 78 STC 88.

Detailed Analysis:
1. The petitioner department contested the claim for exemption made by the assessee in the assessment year 1976-77, totaling Rs. 67,494.18, due to unfructified sales. The assessing officer disallowed part of the claim as time-barred, leading to the imposition of tax. The Appellate Assistant Commissioner and Tribunal upheld the decision. The assessee argued for a refund of sales tax paid, citing double taxation on the same goods in different assessment years.

2. The department argued that as the assessee did not claim exemption in the assessment year 1975-76 when the goods were returned, the subsequent claim in 1976-77 was invalid under the Tamil Nadu General Sales Tax Act, 1959. Reference was made to the Traders and Traders case, emphasizing the time limit for claiming exemption after goods return. The Tribunal's decision granting relief was challenged by the department in revision.

3. The Court considered the facts where goods intended for sale in 1975-76 were returned, resulting in unfructified sales. The department collected tax on these sales, which the assessee sought as a refund in 1976-77. The assessee contended that since the goods were taxed at a single point, they should not be taxed again in the subsequent year. The Court referred to the Peico Electronics case, highlighting the principle of not taxing the same goods twice.

4. Based on the above analysis, the Court found the assessee's plea for deduction on the turnover of Rs. 23,731 and Rs. 3,004 in the assessment year 1976-77 acceptable. The decision in Peico Electronics case supported the assessee's claim for exemption due to unfructified sales and double taxation. Consequently, the Court upheld the Tribunal's order allowing the assessee's claim for refund of sales tax paid.

5. The Court dismissed the revision filed by the department, affirming the Tribunal's decision. No costs were awarded in the matter, and the petition was consequently dismissed.