9911796707
TMI Blog1986 (7) TMI 360X X X X Extracts X X X X X X X X Extracts X X X X ..... . are the assessees. The matter arises under the Kerala General Sales Tax Act, 1963. In T.R.C. No. 12 of 1985, the assessment year with which we are concerned is 1978-79. The respondent is an arecanut dealer. Arecanut is taxable under Schedule 1, entry 47, at the point of last purchase in the State by a dealer who is liable to tax under section 5 of the Act. In T.R.C. No. 71 of 1985, we are concerned with copra. Copra is taxable under Schedule II, entry 6, at the point of last purchase in the State by a dealer who is liable to tax under section 5 of the Act. During the relevant year, the assessee sent the goods outside the State to his agents on consignment basis and such goods formed the closing stock of the assessee as on the last day of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Narayanaswami Naidu [1968] 21 STC I (SC) (at page 5) pointing out the passages wherein the illustration dealt with by the Madras High Court has been quoted. On the other hand, counsel for the assessee-respondent contended that it is settled law that a dealer is not liable to pay tax on the purchases until the purchases acquire the quality of being the last purchases inside the State. The same decision [State of Madras v. Narayanaswami Naidu [1968] 21 STC 1 (SC) (at page 4)] has categorically held so. Mr. Balagangadharan also contended that the attempt of the Revenue to draw a dichotomy between the closing stock of the goods held by the assessee inside the State and outside the State is unwarranted and has no legal foundation. It was submi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld inside the State, they are not exigible to tax. It passes one's comprehension, when counsel for the Revenue submits, that the very same goods, if held by the assessee in a place outside the State, will be exigible to tax on the ground that the goods have acquired the quality of last purchase. Whether inside or outside the State, the goods continued to be that of the assessee. The goods sent to his agents outside the State on consignment basis still continued to be the goods of the assessee. Counsel for the Revenue conceded that the assessee has got the power of disposal over such goods sent on consignment basis outside the State. If the assessee-dealer has got the power of disposal, even over such goods, which were sent to a place outsid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... respondentassessee. It is also relevant to note that explanation to section 2 (xxvi) was added by Act 21 of 1978. The explanation states that in the case of every dealer liable to tax under section 5, regarding the goods which are taxable at the point of last purchase in the State and which are held as closing stock on the last day of any financial year, the amount for which such goods were purchased by the dealer shall be deemed also to be a part of his total turnover for the subsequent year or each of the subsequent years until such goods are either sold by him in the State or such purchase acquires the character of last purchase in the State in the hands of such dealer and in case such purchase acquires the character of last purchase in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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