V M SYED MOHAMED Vs. STATE OF ANDHRA
HIGH COURT OF ANDHRA PRADESH
V M SYED MOHAMED
STATE OF ANDHRA PRADESH
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(1.)THIS is an appeal against the order of our learned brother Satyanarayana Raju, J,, in Writ Petition No. 314 of 1954.
(2.)THE relevant facts are stated in the judgment under appeal and they may be briefly re-stated. The appellants are a firm carrying on tannery business at Guntur. Though they had taken out a licence under Section 5 (vi) of the Madras General Sales Tax Act (hereinafter referred to as the Act) for the year 1951-52, they did not get it renewed for the subsequent years. Nor did they submit a return of their turnover for the year 1952-53. The Commercial Tax Officer, on a scrutiny of the accounts, found that their turnover of sales of tanned hides and skins amounted to Rs. 5,36,001-14-2. To a notice given to them to show cause against assessment on the said turnover, they contended that, as they did riot take out a licence, there was no provision under the Act to tax them. Rejecting the plea, the Commercial Tax Officer made the assessment on the basis of the aforesaid turnover and called upon them to pay a tax of Rs. 8,375-0-6. The appellants filed a petition under Article 226 of the Constitution of India for quashing the said order levying sales tax on the appellants for the year 1952-53. Rejecting their plea that they were not liable to be taxed, Satyanarayana Raju, J. , dismissed the application.
(3.)THE contention of Mr. K. V. Venkatasubramanya Iyer, learned counsel for the appellants, may be stated thus : In the case of hides and skins, Section 5 (vi) of the Act supersedes the charging Section 3 of the Act and under Section 5 (vi) the said commodity is taxable only at such single point in the series of sales by successive dealers as may be prescribed. Rule 16 (5) of the Turnover and Assessment Rules prescribing the point of taxation on the turnover of unlicensed dealers has been held to be ultra vires by the Supreme Court. As there is no rule prescribing the single point in the case of unlicensed dealers, there is no charging provision at all under the Act or the rules framed thereunder in their case and therefore the tax imposed upon the appellants was invalid. The Government Pleader, on the other hand, argues that Section 5 (vi) gives a concession to dealers in hides and skins only on condition they take out a licence and, as the appellants have not taken a licence for the period in question, by operation of Section 6-A, they are liable to be assessed to tax under Section 3 as if the provisions of Section 5 do not apply to such sales. He further contends that Rule 16 (5) is not ultra vires of the powers of the Government and is consistent with the scheme of the Act.
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