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TMI Blog1973 (1) TMI 94X X X X Extracts X X X X X X X X Extracts X X X X ..... t taxable for the reason that they were in the course of import. The assessing authority, however, took the view that the sales effected by the assessees from the bonded warehouses to the outgoing ships were taxable under the Madras General Sales Tax Act, as they were effected after the course of import had ended, and in that view he assessed the respondents for the year 1964-65 on a taxable turnover of Rs. 35,674.93 and for the year 1965-66 on a taxable turnover of Rs. 65,150.98. The assessing authority also levied a penalty of Rs. 1,271 for the year 1964-65 and a penalty of Rs. 2,250 for the year 1965-66 under section 12(3) of the Act. Both against the assessments as well as against the levy of penalty, there were appeals before the Appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or limits of territorial waters, but would only mean the operation of the machinery of the customs department consisting of collection of duty and clearance of the goods, and held that as the goods imported from foreign countries had not been assessed to duty by the customs but were kept in the bonded warehouse without payment of customs duty and straightaway sold to ocean-going vessels by the assessees, they should be held not to have crossed the customs frontier. According to the Tribunal on the facts of this case, the course of import of the goods had not ended and the sales of the goods from the bonded warehouse by the assessees should, therefore, be treated as sales in the course of import. In view of the aforesaid decision of the Supr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... were not taxable and, therefore, they need not register themselves as dealers under the Act. The question whether the sales effected by the assessees were taxable or not has now been decided by this court in the affirmative and the question was being agitated bona fide by them right through. It is well-settled that in cases where the assessability of the transactions of a dealer is in doubt and he bona fide thinks that his transactions will not come under the purview of the Sales Tax Act, his non-registration as a dealer or non-submission of the return in respect of his transactions cannot attract section 12(3) of the Act. We, therefore, confirm the order of the Tribunal setting aside the orders of penalty. The tax cases are, therefore, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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