1997 (3) TMI 578 - HC - VAT and Sales Tax

Summary

Issues:
1. Constitutional validity of sections 4-B and 5(3)(a)(ii) of the Punjab General Sales Tax Act, 1948.
2. Challenge to the notifications dated April 6, 1973, and December 20, 1973.
3. Liability to pay purchase tax on paddy and rice purchased in Punjab and dispatched to branches in other states.
4. Refund of the purchase tax collected by the respondents.
5. Interpretation of Supreme Court judgments related to purchase tax levy.
6. Challenge to the levy of purchase tax based on incidental charges.

Detailed Analysis:
1. The petitioner, a statutory body under the Food Corporation Act, challenged the constitutional validity of sections 4-B and 5(3)(a)(ii) of the Punjab General Sales Tax Act, 1948, along with notifications issued by the Government of Punjab. The petitioner sought a declaration of non-liability to pay purchase tax on paddy and rice dispatched to branches in other states and requested a refund of the tax collected by the respondents.

2. The petitioner, engaged in purchasing wheat, rice, and paddy in Punjab, contended that the provisions in question were ultra vires to the State Legislature's powers. The challenge was based on previous court decisions, including one related to the Haryana General Sales Tax Act. The petitioner's argument was supported by references to relevant legal precedents.

3. The court, after hearing arguments from both parties, found that the petitioner's challenge to the purchase tax levy did not hold ground in light of Supreme Court judgments and previous decisions by the High Court. The court referenced specific cases like Hotel Balaji v. State of Andhra Pradesh and Devi Dass Gopal Krishan Pvt. Ltd. v. State of Punjab to support its conclusion.

4. The court highlighted that the petitioner failed to demonstrate how the purchase tax levy could be deemed unlawful based on existing legal rulings. Additionally, it was noted that a previous Supreme Court judgment related to a similar matter had been set aside in a review petition filed by the State of Haryana, further affecting the petitioner's argument.

5. The petitioner's attempt to challenge the purchase tax levy based on incidental charges was dismissed by the court. The court emphasized that without a factual foundation and a specific prayer in the writ petition to quash any particular order, the argument could not be entertained. Consequently, the court dismissed the writ petition, upholding the validity of the purchase tax levy in question.