SABYASACHI MUKHARJI - (1.) THIS appeal by special leave arises from the Judgment and order dt. 14th Dec. 1972 of a Bench decision of the High Court of Andhra Pradesh in Writ Petn. No. 3464 of 1971, (reported in 1973 Tax LR 2590).
(2.) THE Division Bench dismissed the application under Art. 226 of the Constitution filed by the appellant. THE appellant was a tanner who had his tannery at Vizianagaram and was at the material time a dealer under Andhra Pradesh General Sales Tax Act, 1957 as well as the Central Sales Tax Act, 1956, hereinafter called the 'State Act' and the 'Central Act' respectively. THE appellant purchases raw hides and skins in the State of Andhra Pradesh and tan the same. THE appellant used mostly to sell such tanned hides mostly to sell such tanned hides in the course of inter- State trade. The first respondent i.e. the Commercial-tax Officer, Vizianagaram, by his order dated 30/01/1969 had assessed the appellant's inter-State sales turnover at Rs. 16,23,194.29 and levied a tax of Rs. 48,695.82 under the Central Act. The local purchase turnover of raw hides was assessed at Rs. 7,92,585.00 and a tax of Rs. 23,777.66 was also levied. The appellant had filed previously writ Petition No. 3436 of 1969 challenging the validity of the Central Sales-tax Amendment Act, 1969. That petition, however, was withdrawn in view of the judgment of the Andhra Pradesh High Court in January, 1971. The appellant thereafter filed the present petition out of which this appeal arises for declaring Item 9(b) of Schedule III of the State Act as unconstitutional and void and further declaring that no tax could be levied or was leviable under the Central Sales-tax Act on the inter-State sales of tanned hides which have already suffered tax at the untanned stage. Further declaration was sought, prohibiting the respondents who are the sales-tax authorities from enforcing the order dt. 30th Jan. 1969 and directing the respondents to refund the amount already collected.
(3.) IN order to appreciate the contention it is necessary to refer to Item 9(b) of Sch. III of the State Act as it stood at the relevant time which reads as follows : THIRD SCHEDULE (Declared goods in respect of which a single point tax only is leviable under S. 6) JUDGEMENT_479_2_1986Html1.htm The submission urged on behalf of the dealer/appellant was that Item 9(b) of Sch. III of the State Act discriminated between hides and skins imported from outside the State and those manufactured or produced in the State. The contention was that Item 9(b) provides for levy of tax on the sale of hides and skins brought from outside the State and tanned inside the State whereas if raw hides and skins were locally purchased and tanned, there was no tax leviable on the tanned hides and skins as the untanned hides and skins in such cases alone were taxed. It was urged that the result of the taxation scheme was that a dealer who brought raw hides and skins from outside the State and tanned these locally was taxed on the amount of the sale of such tanned hides and skins, whereas the locally purchased raw hides and skins and tanned were taxed on the amount of the purchase of the raw hides and skins the price of which compared to the price of tanned hides and skins would be very insignificant. It was submitted that such taxation scheme, therefore, discriminated against the import of raw hides and skins for bringing them inside the State. It was submitted that this offended Art. 304(a) of the Constitution inasmuch as the goods manufactured or produced locally got a more favourable treatment than the goods imported from other States.;