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TMI Blog1954 (9) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... was to levy sales tax on the purchase of unshelled ground-nut. He further contends that having regard to the certificate of the Central Laboratories, cotton-seed oil being an edible oil, the Commissioner was wrong in holding that the said oil was not edible merely because cotton-seed oil is not consumed in this State. Sub-rule (2) of rule 5 of the Hyderabad General Sales Tax Rules is as under: "In the case of the undermentioned goods the turnover of a dealer for the purpose of these rules shall be the amount for which the goods are bought by the dealer- (a) ground-nut, (b) Bidi leaves, (c) Tarwar and other tanning barks, (d) Til, karad and castor-seed, (e) Cotton including kapas, (f) Cotton-seed, (g) Linseed, turmeric, dhania and other a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deferred payment or other valuable consideration." The taxing section therefore authorises the imposition of a sales tax either on the purchase or the sale turnover of the dealer and according to sub-rule (2) of rule 5, the purchase turnover of the dealer on the commodities specified therein is liable to levy of a sales tax. The learned advocate for the department contends that the object of the aforesaid rules was to impose a tax on the purchasers of agricul- tural commodities because by reason of the extensive sales in short quantities by agriculturists it is difficult administratively to collect taxes on the sale of those commodities. Though we are in agreement with him that the object of sub-rule (2) of rule 5 was to levy a sales tax on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ention of the rule was only confined to the levy of tax on purchase turnover on the agricultural produce or raw commodities, such as hides and skins. This intention is further clarified by the later additions of items (e) to (h) in sub-rule (2) of rule 5. In this view of the matter, the word "ground-nut" for the pur- pose of sub-rule (2) of rule 5, in our view, would be the unshelled ground-nut produced by the agriculturists and not the kernel. "Ground- nut" or "ground-bean" or "pea-nut" is the fruit of "Arachis hypogoea", which ripens underground. The pods, though first formed in the air, are as they increase in size forced into the earth by a natural motion of their stalks, and there come to maturity 3 or 4 inches under the surface, hence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... copra as being liable to tax on the purchase turnover of the dealer. The Hyderabad Sales Tax Rules also could have specified the kernel of the ground-nut if it were the intention to tax the purchase turnover of the ground-nut kernel. We are not therefore impressed by the contention of the learned advocate for the department that since ground-nut generically would include shelled ground-nut as well as unshelled ground-nut, the purchase turnover of kernel should be taxed. The crucial test in matters of sales tax is what is the article or com- modity which is intended to be reached. In our view, the purchase turnover of a buyer of unshelled ground-nut or the pod is what is intended to be taxed for the reasons stated above. The second point, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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