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TMI Blog1980 (2) TMI 237X X X X Extracts X X X X X X X X Extracts X X X X ..... e total turnover for a year is not less than twenty-five thousand rupees and every casual trader or agent of a non-resident dealer, whatever be his total turnover for the year, shall pay tax on his taxable turnover for that year,- (i) in the case of goods specified in the First or Second Schedule, at the rates and only at the points specified against such goods in the said schedules and (ii)...................... (2) Every dealer other than a dealer referred to in sub-section (1) whose total turnover for a year in respect of the goods specified in the First or Second Schedule is not less than two thousand five hundred rupees shall pay tax at the rate and only at the point specified against the goods in the First or Second Schedule, as the case may be, on his taxable turnover in that year relating to such goods: ......................................" Tapioca is mentioned in entry 72 in the First Schedule. This entry reads: ------------------------------------------------------------------------------------------------------------- "Sl. Description Point of levy Rate No. of the goods of tax (1) (2) (3) (4) ----------------------------------------------------------- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aler may, get himself registered under this Act. (2) Notwithstanding anything contained in sub-section (1), every dealer carrying on business in all or any of the goods mentioned in the First and the Second Schedules whose total turnover in respect of those goods in any year is not less than two thousand five hundred rupees shall get himself registered. (3) Notwithstanding anything contained in sub-section (1) or subsection (2),- (i) every casual trader; .............................. (iv) every agent of a non-resident dealer; and ........................... shall get himself registered under this Act, irrespective of the quantum of his total turnover in such goods. ............................." All persons coming within the mandatory provisions of section 13 must register themselves as dealers. The effect of this provision is that, apart from casual traders, whatever be their total turnover, dealers carrying on business in tapioca (which falls within the First Schedule) and having an annual total turnover of not less than Rs. 2,500 must get themselves registered. 6.. The effect of these provisions is that every dealer who comes within the ambit of section 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atutory provisions. The subrule requires that every dealer in goods taxable at the last point of purchase, and on whom the liability to pay tax is cast under section 5, but who by virtue of the provisions of entry 72 claims exemption from tax, being not the last purchaser in the State as a dealer liable to pay tax under section 5, has to obtain a declaration from the person who purchased the goods from him to the effect that such purchaser is a dealer who is liable to pay tax under section 5. The sub-rule says "every purchaser shall issue such a declaration to the seller". This has to be understood as every purchaser who purchases as a dealer who is liable to pay tax under section 5. It is such a buyer who has to issue a declaration to the seller to that effect. It is the seller whose identity as not the last purchaser as a dealer liable to pay tax is established by means of a declaration in the requisite form, viz., form 25, who is entitled to the exemption stated under entry 72. Form 25 is very specific on this point. It reads: "Form of declaration to be furnished by a Purchasing dealer when goods taxable at the Point of last Purchase in the State are Purchased by him. [See r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ulars required in form 25 are arbitrary provisions in so far as they exclude the possibility of an assessee proving his claim for exemption otherwise than by showing that the person to whom goods were sold was possessed of the necessary registration certificate. The petitioner's counsel contends that subrule (14) has to be read as directory and not mandatory, for there may be cases where it would be possible for the assessee to show that, although the person to whom goods were sold did not possess a certificate of registration as a dealer, was in fact a dealer liable to tax by reason of the nature and size of his activities. He relies upon the decision of this Court in Phipson And Company Limited, Ernakulam v. Sales Tax Officer, Special Circle, Ernakulam[1967] 19 S.T.C. 200; 1967 K.L.T. 623., where it was held that the requirement of sub-rule (13) of rule 32 was directory and not mandatory. 8.. Sub-rule (13) reads as follows: "(13) Every dealer in goods taxable at the point of first sale in the State, shall, if he is not liable to tax on such goods by reason of his not being the first seller of the goods in the State, obtain a certificate written and signed underneath or on the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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