S.Thangaraj, (Chairman), J. - (1.) THE Original Petition No. 197 of 2002 is filed by the petitioner -association to declare that explanation 1 to Section 2(n) of the Tamil Nadu General Sales Tax Act, 1959 is ultra vires of the Constitutional 46th Amendment as well against the principles laid down by the Supreme Court in its judgment reported in Joint Commercial Tax Officer v. Young Men's Indian Association [1970] 26 STC 241.
(2.) THE Original Petition No. 198 of 2002 is filed by the petitioner -association to declare that the transaction of wattle extract of the petitioner -society being an incorporated association with its members is not exigible to levy of tax under the Tamil Nadu General Sales Tax Act, 1959 as they are exempted under Section 5(2) of the Central Sales Tax Act, 1956. The petitioner - -M/s. South India Tanners and Dealers Association, Ranipet, Vellore District is an incorporated society registered under the Tamil Nadu Societies Registration Act with Registration No. S6/1944 with effect from September 6, 1944. The petitioner, acting as an agent on behalf of its members who require wattle extract for the purpose of tanning the leather as the members are tanners. On the individual orders for import of wattle extract placed by the tanners, the association, in its capacity as agent to its members, pooled together the orders, and import orders placed with the foreign sellers by the association on behalf of its members and the goods so imported are apportioned among the members. The petitioner -association cannot sell wattle extract to any outside persons who have not placed orders. As Section 5(2) of the Central Sales Tax Act, 1956 exempt levy of tax, no tax can be leviable under the Tamil Nadu General Sales Tax Act, 1959 also.
(3.) THE respondents have filed counter -affidavit stating that the import was made by the association on its own account and the goods were sold to its members. The import licence is in the name of the association and therefore, there was transfer of property in wattle extract from the association to its members. The petitioners have not produced any evidence to show that they are acting as agent to its members. The society, being incorporated as a dealer and the transfer by the society to its members is a sale exigible to tax. The petitioners have not proved that it was an import under Section 5(2) of the Central Sales Tax Act, 1956 and the transactions were effected when the goods were on the high seas. Further, it was contended that the levy of tax on supplies effected falls within the ambit of Section 2(n)(v) of the Act in conformity with article 366 and Clause (29A)(e) of the Constitution of India.;