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TMI Blog1956 (2) TMI 49X X X X Extracts X X X X X X X X Extracts X X X X ..... refore both the petitioner and the selling registered dealer were exempt from paying sales tax under the provisions of section 5(2)(a)(ii) of the Act. The present petitioner however broke the undertaking and sold the goods outside the State of Orissa. The Department therefore included the sale prices of such goods which the petitioner sold outside Orissa having broken the undertaking within the taxable turnover of the petitioner. In doing so the Department relied upon the proviso to section 5(2)(a)(ii) of the Act. It would be pertinent to quote the relevant portions of section 5 of the Act. "5. (1) The tax payable by a dealer under this Act shall be levied at the rate of one quarter of an anna in the rupee on his taxable turnover: (2) In this Act the expression 'taxable turnover' means that part of a dealer's gross turnover during any period which remains after deducting therefrom: (a) his turnover during that period on-(the clause that we are pertinently concerned with is) (ii) sales to a registered dealer of goods specified in the pur- chasing dealer's certificate of registration as being intended for re-sale by him in Orissa or for use by him in the execution of any contract in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T.C. 687; A.I.R. 1955 S.C. 786. C.P. and Berar Sales Tax Act that he had purchased the said goods for use as raw material in the manufacture of goods for sale by actual delivery in Madhya Pradesh for the purpose of consumption in that State and further that he had sold those articles outside the State of Madhya Pradesh. Their Lordships held that the Madhya Pradesh authorities could not tax such transactions. On a careful perusal of the decision of their Lordships we are of the view that the decision has no bearing for the purpose of deciding the present case inasmuch as their Lordships of the Supreme Court exempted the liability of such transactions from being taxed by the Madhya Pradesh authorities only on the ground that the transactions were in the course of inter-State trade or commerce as contemplated under Article 286(2). After analysing the facts and circumstances of the case, their Lordships observed: "As a result of the transactions entered into by the petitioners with these suppliers the finished tobacco which was supplied to the petitioners moved from the State of Bombay to the State of Madhya Pradesh and these transactions were, therefore, in the course of inter- State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mention even in the petition filed before us that these transactions were of such nature. In our view, therefore, the decision of the Supreme Court is of no assistance. The petitioner, therefore, has now to fall back upon Article 286(1) of the Constitution relying upon the position that the sales which are being taxed in the present case being outside the State of Orissa are exempt from taxation by the State authorities and are beyond the reach of the State law. This contention is fully covered and negatived by the previous decision of this Court in the case of K.S.E. Ahmed Mohinuddin v. Sales Tax Officer, Ganjam (O.J.C. No. 253 of 1954 Unreported).* In that case, on a careful analysis of the relevant provisions of the section, My Lord the Chief Justice came to the conclusion that it was not the second sale by the petitioner outside the State of Orissa which was the basis for taxation in the present case but the first sale in which the present petitioner was the purchaser from another registered dealer. It appears clear that on account of this undertaking given by the present petitioner that the articles purchased by him as a registered dealer would be sold within the State of Oris ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enact the law in the Act and not in the rules. In our Act it is a part of the statute itself and there being no legal or constitutional bar on the part of the State Legislature to put in this proviso, the departmental authorities are entitled to realise the tax from the purchaser under the said proviso. 6.. In conclusion, therefore, the petition fails and is dismissed with costs. Hearing fee is assessed at Rs. 100. (Rupees one hundred). 7.. O.J.C. 241/54: Here the assessment is for the quarters ending 30th June, 1951, to 31st March, 1952, that is, for four quarters. The petitioner who is a registered dealer in turmeric, chillies, jute etc., on submitting his returns for the aforesaid quarters, claimed deduction under the provisions of section 5(2)(a)(ii) of the Orissa Sales Tax Act, 1947. The departmental authorities allowed deduction excepting in respect of the transactions which constituted a breach of the under- taking given by the present petitioner at the time of purchase from another registered dealer that the articles were intended for re-sale in Orissa. The petitioner, however, had sold the articles outside Orissa on account of which the Sales Tax Authorities have includ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... integrated activities commencing from the agreement of sale with a foreign buyer and ending with the delivery of the goods to a common carrier for transport out of the country by land or sea", was explained in this decision as: "The phrase 'integrated activities' was used in the previous decision to denote that 'such a sale' (i.e., a sale which occasions the export) (1) [1953] 4 S.T.C. 205; A.I.R. 1953 S.C. 333. (2) [1952] 3 S.T.C. 434; A.I.R. 1952 S.C. 366. 'cannot be dissociated from the export without which it cannot be effectuated, and the sale and the resultant export form parts of a single transaction'. It is in that sense that the two activities-the sale and the export-were said to be integrated".
9.. In this case, however, we do not think it necessary to further discuss the exact meaning of the words "in the course of inter-State trade or commerce" as there is a signal lack of materials to come to the conclusion that the transactions in question were in the course of inter-State trade or commerce.
10.. This petition therefore is accordingly dismissed with costs. Hearing fee is assessed at Rs. 100 (Rupees one hundred).
PANIGRAHI, C.J.-I agree.
Petitions dismissed. X X X X Extracts X X X X X X X X Extracts X X X X
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