9911796707
TMI Blog1956 (3) TMI 30X X X X Extracts X X X X X X X X Extracts X X X X ..... esenting goods sold and delivered to dealers outside Bihar for sales to consumers in those places, (3) Rs. 1,01,54,907-15-0 representing sales of goods made by the company's agents or secretaries at Calcutta, Madras, Delhi, Coimbatore, Karachi, Lahore and other places and (4) the rest representing goods sold to dealers in Bihar. The taxable turnover was determined at Rs. 2,01,19,980 out of which the amount of Rs. 1,91,59,760 was assessed at three pies per rupee and the rest, namely, the amount of Rs. 9,60,220-15-0 was assessed at six pies per rupee. The total assessment came to be Rs. 3,29,378-2-0. The applicant claimed a deduction on account of goods sold outside Bihar covered by the first three categories of sales price referred to above. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed his application for reference on questions of law to this Court. This application was allowed and the following questions have been referred for the decision of this Court. They are: "(1) Whether the definition of sale as given in section 2(g) as amended by the Bihar Sales Tax Act of 1948 is ultra vires the Bihar Provincial Legislature under the Government of India Act of 1935; and, (2) Whether under the facts and circumstances of the case the petitioner could be legally taxed for sales of goods delivered outside the State of Bihar after the 26th January, 1950." It has been submitted by the counsel of both the parties that the first question has not been accurately formulated and accordingly this question is recast as under: "Whether t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t "Except in so far as Parliament may by law otherwise provide, no law of a State shall impose, or authorise the imposition of, a tax on the sale or purchase of any goods where such sale or purchase takes place in the course of inter-State trade or commerce." A proviso is added to this sub-clause which is to the following effect: "Provided that the President may by order direct that any tax on the sale or purchase of goods which was being lawfully levied by the Government of any State immediately before the commencement of this Constitution shall, notwithstanding that the imposition of such tax is contrary to the provisions of this clause, continue to be levied until the thirty-first day of March, 1951." In pursuance of the above proviso, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made, or (ii) which are produced or manufactured in Bihar by the producer or manufacturer thereof, shall wherever the delivery or contract of sale is made, be deemed for the purposes of this Act to have taken place in Bihar: Provided further that the sale of goods in respect of a forward contract, whether goods under such contract are actually delivered or not, shall be deemed to have taken place on the date originally agreed upon for delivery". Relying on this definition, the Superintendent of Sales Tax held the assessee to be liable for assessment inasmuch as the goods sold were produced or manufactured in Bihar by the assessee. The contention of the assessee about the bar of imposition of tax under Article 286 of the Constitution was ov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecessary to examine any more the validity of the argument advanced on behalf of the assessee. On these decisions it is manifest that the definition of sale as given above is ultra vires the Provincial Legislature to the extent it contravenes Article 286 of the Constitution and the assessee could not legally be taxed in the present case for sales of goods delivered outside the State of Bihar after the 26th January, 1950. Both the questions referred to this Court for answer have to be and are, therefore, answered in favour of the assessee and against the State. In the circumstances of the case, however, there will be no order as to costs. BANERJI, J.-I agree. Reference answered in favour of assessee. - - TaxTMI - TMITax - CST, VAT & S ..... X X X X Extracts X X X X X X X X Extracts X X X X
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