K M ADAM Vs. STATE OF MADRAS

JUDGEMENT

(1.) THE assessee in this case is a dealer in reptile skins. He reported a total turnover of Rs. 10, 56, 391. 03 for the year 1962-63 and claimed exemption in relation to the entire turnover on the ground that it represented sales in the course of export. THE assessing authority, after check of the accounts, found that the assessee had a total turnover of Rs. 12, 91, 408. 31, made up of Rs. 12, 64, 483. 42 relating to purchase of raw reptile skins, Rs. 26, 330. 90 relating to the purchase of tanning materials and Rs. 593. 99 relating to the sales of tannery waste. He determined the taxable turnover of the assessee as Rs. 12, 91, 408. 31 and assessed him at 2 per cent, on Rs. 12, 65, 077. 41 and at one per cent. on Rs. 26, 330. 90. THE assessee had contended before the assessing authority that the purchase of raw reptile skins would fall under item 52 of the First Schedule of the Tamil Nadu General Sales tax Act and not under item 7 (a) of the Second Schedule.

(2.) ACCORDING to the assessing authority, the purchase of reptile skins is taxable at the hands of the assessee as the last purchase under item 7 (a) of Schedule II of the Act. Aggrieved by this, the assessee preferred an appeal to the Appellate Assistant Commissioner who, by his order dated 31st August, 1964, negatived the contention of the assessee that raw reptile skins fall under item 52 of Schedule I of the Act, and held that it fell under item 7 (a) of Schedule ii of the Act. The Appellate Assistant Commissioner, however, held that the assessee having purchased raw reptile skins for a sum of Rs. 2, 75, 193. 44 inter-State, the said turnover was liable to be exempted. He ultimately determined the turnover relating to the local purchase of reptile skins at Rs. 9, 90, 883. 97 and the taxable turnover at Rs. 10, 17, 214. 87. The assessee took the matter to the Tribunal where he contended that the sum of Rs. 9, 90, 883. 97 representing the last purchases of reptile skins within the State would not fall under item 7 (a) of Schedule II and that if at all the sales of those reptile skins could be brought under item 52 of Schedule I. The Tribunal, however, held that the assessee is liable to be taxed in respect of the said turnover under item 7 (a) of Schedule II. That view of the Tribunal is being challenged before us.