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TMI Blog2010 (7) TMI 878X X X X Extracts X X X X X X X X Extracts X X X X ..... .238 of 1998 dated 04.04.2000 whereby the order of the Appellate Assistant Commissioner dated 07.11.1997 confirming the order of the assessment officer dated 29.11.1996 for the assessment year 1992-93 has been set aside. 2.The brief facts of the case in a nutshell are as follows: 2.1.The respondent / assessee is an oil miller being a manufacturer of coconut oil and coconut oil cake. It has purchased coconuts and copra from both dealers and the agriculturists. 2.2.Based upon the checking of the accounts a best of judgment assessment has been made making the assessee liable for tax on the purchase of coconuts and copra at 4% under Section 7-A of the Tamil Nadu General Sales Tax Act, 1959 (hereinafter called as 'Act') in T.N.G.S.T. 845223/92-93 dated 29.11.1996 for the assessment year 1992-93 by fixing the turnover at Rs.4,79,650/-. Challenging the said assessment an appeal was filed by the assessee to the First Appellate Authority contending that inasmuch as the sale of coconuts and copra having been exempted and the purchases are not being first one purchase tax cannot be levied on the assessee. It was also contended that the assessing authority cannot shift the point of levy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther the respondent is liable to be taxed under Section 7-A of the Act or not. 6.The Tribunal has made reliance upon the judgment of the Apex Court rendered in SHANMUGA TRADERS v. STATE OF TAMIL NADU [VOL.114 1999 STC PAGE 1] and held that when the first sale is exempted the point of levy cannot be shifted to fix a liability on the assessee. It is further held that point of levy of tax cannot be shifted on the assessee after the first sale. A reading of the order of the Tribunal would clearly show that the Tribunal has totally misconceived the facts of the case and applied the judgment rendered in SHANMUGA TRADERS v. STATE OF TAMIL NADU [VOL.114 1999 STC PAGE 1] wrongly. 7.It is an case of wrong application of a judgment to the facts involved in a particular case. Admittedly the assessee is a purchaser and not a seller. The facts involved in the judgment reported in SHANMUGA TRADERS v. STATE OF TAMIL NADU [VOL.114 1999 STC PAGE 1] are concerned with the sale and not a purchase. Therefore the decision of the Tribunal basing reliance upon the said judgment is totally erroneous and liable to be set aside. 8.Section 7-A of the Act is both a remedial and a charging provision. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be preferred to the one which would render it otiose or sterile." 10.Therefore on a reading of the above said judgment, we are of the considered view that the assessee is liable to pay the purchase tax in accordance with Section 7-A of the Act. 11.Section 17 of the TNGST Act, 1959 provides for the state Government to issue notifications regarding exemptions. An exemption so granted may be partial or total to be applicable for specifying class of goods or persons at all points or specifying points. When such an exemption is given to only a specified class of persons for the sale the same is only partial in nature and in such an eventuality the exemption would not cover the liability under Section 7-A of the Act. In the present case on hand, admittedly the exemptions do not cover the assessee and therefore merely because the sales by the agriculturists are exempted it cannot be contended that the purchase made by the assessee also to be exempted in the teeth of Section 7-A of the Act. 12.The judgment of the Apex Court referred above has been followed subsequently by the Hon'ble Supreme Court in COFFEE BOARD, KARNATAKA v. COMMISSIONER OF COMMERCIAL TAXES AND OTHERS [VOL.70 198 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the provisions of the Act. The reason being that goods which normally have been taxed at some point do not get taxed again. The policy of law is to tax every transaction of sale either at the point of sale or at the point of purchase. Exemption is granted either partially or in absolute. Where the seller is not taxed, the purchaser is taxed. By the same reasoning, when the seller is taxed, the purchaser is not taxed. As already seen there may be several contingencies wherein no such first sale liable to tax is assessed and that goods are no longer available either because they cease to exist or be available for further consideration attracting tax. In such contingencies, if the selling dealer cannot be taxed, the purchasing dealer is taxed by levy of purchase tax. The Supreme Court in the decision reported in [1993] 88 STC 98 (SC) (HOTEL BALAJI v. STATE OF ANDHRA PRADESH), held that the postponement does not convert what is avowedly a purchase tax to a consignment tax or tax on consumption. In so taxing, the question of shifting the point of taxation also does not take place. It is relevant to note that even in the case of local sales, where the first sale has not suffered tax, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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