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TMI Blog2004 (5) TMI 538X X X X Extracts X X X X X X X X Extracts X X X X ..... ure by amending section 2(1)(a), making it applicable to the dealers other than the dealers registered in Tamil Nadu and by introducing a new provision in the shape of section 2(1)(aa), raising exemption limit regarding the liability to pay additional sales tax so far as the registered dealers in Tamil Nadu are concerned to more than Rs. 100 crores, the provision was found offensive. In other words, section 2(1)(a), as it originally stood, was not found offensive, but section 2(1)(a) as amended by the Act 31 of 1996 was struck down and the new provision as contained in section 2(1)(aa) with required modifications was held to be applicable to all concerned. Even though the learned counsel appearing for the petitioner is correct in his submission to the effect that striking down of section 2(1)(a) did not have the effect of reviving section 2(1)(a) as it originally stood, the fact remains that so long as that provision, namely, section 2(1)(a) of the unamended Act, was in statute book, the liability to pay tax as per such provision was already incurred. In other words, the liability as envisaged under section 2(1)(a) as per the original Act was in existence for the period from April ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he case of a dealer whose taxable turnover for a year exceeds ten lakhs of rupees, be increased by an additional tax calculated at the following rates, namely: Rate of tax (i) Where the taxable turnover exceeds ten 1.5 per cent of the lakhs of rupees, but does not exceed one taxable turnover crore of rupees: Provided that no additional tax shall be payable under this item for the first ten lakhs of rupees of the taxable turnover. (ii) Where the taxable turnover exceeds one 2 per cent of the crore of rupees but does not exceed five taxable turnover crores of rupees. (iii) Where the taxable turnover exceeds five 2.25 per cent of the crores of rupees but does not exceed ten taxable turnover crores of rupees. (iv) Where the taxable turnover exceeds ten 2.5 per cent of the crores of rupees but does not exceed taxable turnover three hundred crores of rupees. (v) Where the taxable turnover exceeds 3 per cent of the three hundred crores of rupees. taxable turnover. 2. The aforesaid provision was amended by Act 31 of 1996 and in place of the expression dealer, the words a casual trader or agent of a non-resident dealer or a local branch of a firm or company situate outside the State was sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of sub-section (1) of section 2 of the principal Act, namely, Act 14 of 1970 is ultra vires and should stand deleted. We make it clear that we are striking down only clause (a) of section 2(1). We also make it clear that under section 2(2) and 2(3) the intention of the Legislature not to pass on the burden of additional sales tax to the consumers and the reference to prosecution, shall stand unaltered. So far as section 2(1)(aa) as amended by Tamil Nadu Act 31 of 1996, the following words shall stand deleted, as obnoxious: (1) The words 'in this State' after the words, 'principal selling or buying goods' in section 2(1)(aa) as well as in Explanation to section 2(1)(aa). (2) The words 'other than a casual trader or agent of a nonresident dealer or a local branch of a firm or company situated outside the State' in section 2(1)(aa). If the above directions are carried out the exemption granted up to rupees one hundred crores will be equally applicable to all dealers.... 5. Now, the facts. The petitioner was assessed to sales tax under the Tamil Nadu General Sales Tax Act for the assessment year 1996-97 on a total turnover of Rs. 147,31,85,717 and a taxable tur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 2(1)(aa), which came into force with effect from August 1, 1996 and which as per the aforesaid decision was toned down and was made applicable equally to all, envisaged a taxable turnover of more than Rs. 100 crores in order to attract liability to pay additional sales tax. Since such provision has become effective from August 1, 1996 and the taxable turnover of the petitioner between the period August 1, 1996 to March 31, 1997 was less than Rs. 100 crores, there was no question of paying any additional sales tax during the aforesaid period. 7. It is true that in the decision in question, namely Siemens Limited v. State of Tamil Nadu [1998] 110 STC 313, the Tribunal had observed: To give effect to the said intention we proceed to hold that clause (a) of sub-section (1) of section 2 of the principal Act, namely, Act 14 of 1970 is ultra vires and should stand deleted. We make it clear that we are striking down only clause (a) of section 2(1). The aforesaid observation of the Tribunal considered in isolation, supports the contention of the petitioner to the effect that there was no provision attracting liability to pay additional sales tax before August 1, 1996. However, as rig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view of the above, the contention of the learned counsel for the petitioner that there was no liability during the period from April 1, 1996 to July 31, 1996 is not acceptable. 8. Even assuming that there was no liability to pay and there was no provision regarding payment of additional sales tax between April 1, 1996 and July 31, 1996, the annual turnover of the petitioner for the assessment year 1996-97 was admittedly more than Rs. 100 crores. It is immaterial that the taxable turnover for the period from August 1, 1996 to March 31, 1997 did not exceed Rs. 100 crores. Even assuming that the liability to pay additional sales tax arose only with effect from August 1, 1996, the contention that the taxable turnover after the said date alone could be considered is also not tenable. The assessing officer was justified in coming to a conclusion that the taxable turnover for the period between April 1, 1996 and March 31, 1997 being more than Rs. 100 crores, the petitioner was liable to pay additional sales tax even as per the amended provision as contained in section 2(1)(aa). 9. In either view of the matter, the contention raised is unacceptable. 10. Learned Senior Counsel has contende ..... X X X X Extracts X X X X X X X X Extracts X X X X
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