- (1.) THIS is a revision against the appellate order of the Deputy Commissioner, Sales Tax (Appeals), Kota Division, Kota dated 11. 5. 60, by which he has confirmed the assessment order of the Assistant Sales Tax Officer, Tonk, and imposed assessment of tax of Rs. 144. 62 NP on the applicant. The contention on behalf of the applicant is that his taxable turn-over during the year under assessment (1957-58) admittedly being only Rs. 6157/11/-, much below the limit prescribed by sec. 3 (1) of the Rajasthan Sales Tax Act, 1954 Rs. 12,000/-, (hereinafter referred to as the Act), he could not be assessed to sales tax on this amount. The learned Deputy Commissioner, Sales Tax (Appeals) has rejected this contention with the observation that under sec. 3 (2) of the Act the applicant had been correctly assessed to tax because of his proportionate sales having exceeded the limit of Rs. 12,000/- and his having obtained Registration Certificate willingly. The point for determination, therefore, is whether the case of the applicant is covered by sec. 3 (2) of the Act and whether only because of his obtaining the Registration Certificate the applicant can be assessed to tax. THIS would necessitate the examination of the relevant provision of law in this behalf, Sec. 3 of the Act is not the 'charging section'; It only describes "incidence of taxation or a liability to pay tax,", for the purpose relevant to the present case, as " (1) Subject to the provisions of this Act every dealer whose turn-over in the previous year in respect of sales or supply of goods exceeds (c) Rs. 12,000/-". "shall be liable to pay tax under this Act on his taxable turnover in respect of sales or supplies of goods effected from the date of commencement of this Act. "
(2.) IT very dearly shows that if a dealer has a turnover in 'previous year', defined by sec. 2 (m) to mean "the 12 months ending on the 31st day of March next preceding the assessment year, or, if the accounts of a dealer have been made upto date within the said 12 months in respect of a year ending on any date other than the said 31st day of March then, at the option of the dealer ending on the date up to which accounts have so been made up", (Note.-The provision is not relevant for the present case) in respect of "sales or supplies of goods exceeding Rs. 12,000/-", he shall be "liable to pay tax" on his "taxable turn-over" in respect of all sales or supplies of goods effected during the assessment year. In other words, the liability to pay tax under the Act on his taxable turnover by a dealer during any assessment year depends not on this limit of Rs. 12,000/-during that year but during the year immediately preceding it. Once the dealer becomes "liable to pay tax" under sec. 3 (1) (c) of the Act, he shall have to pay tax in accordance with the provisions of the Act on his taxable turnover in respect of sales or supplies of goods effected during the assessment year. The registration under sec. 6 of the Act is, for purposes relevant to this case, compulsory for carrying a business as a dealer by a person having 1 is turn-over in the previous year in respect of sales or supplies of goods exceeding Rs. 12,000/ -. It has got nothing to do with the assessment or payment of tax. The tax is to be paid at the rate prescribed by sec. 5 of the Act on the assessment made on his "taxable turnover" during any year determined under sec. 10 (which is the charging section) on the basis of the returns and other information received by the assessing authority under secs. 7 and 8 of the Act. Sec. 3 (2) of the Act has also got nothing to do with it. This sub-section is meant only for the dealer who may not be found liable to pay tax under sub-sec. (1) or who was having no business in the previous year. He too can be liable to pay tax, under the Act; vide this sub-sec. with effect from the date when his sales for the period from the first day of April, (i. e. assessmens year' as defined by sec. 2 (c) on such an amount as would render proportionate sale upto 31st March liable to tax according to sub-clauses (a), (b) or (c) of sub-sec. (1 ). This sub-sec. is thus meant only to make a dealer not falling within the purview of sub-sec. (1) also liable to pay tax if his taxable turn-over exceeds the limit prescribed by sub-sec. (1 ). Obviously, as such, the learned Dy. Commissioner Sales Tax, has relied wrongly on sub-sec. (2) of sec. 3 of the Act. He has not been entirely correct in holding that when the applicant has got himself registered as dealer willingly, he is bound to pay tax. The liability to pay tax rests on the provisions of sec. 3 (1) of the Act, though a person who is laible to pay tax has got to get himself registered under sec. 6 of the Act, to carry on his business. The registration therefore, raises a strong presumption in favour of Lability of a dealer to pay tax. It is not a determining factor. Unless a person who has been registered, establishes that he has been wrongly and fraudulently registered, there is a strong presumption in favour of his liability to pay tax. The applicant, however, is clearly liable to pay tax as he does not contest that his turnover in the 'previous year' in respect of sales or supplies of goods did not exceed Rs. 12,000 a year. His liability to pay tax has thus been established. He will have to pay tax under sec. 5 and sec. 10 of the Act, even though during the assessment year his taxable turn-over was less than the amount prescribed to determine his liability. The liability to pay tax springs from the turn-over in the 'previous year' whereas the charge ability for the tax is determined on the taxable turn-over during the year of the assessment. No minimum limit is prescribed in the latter case. In view of the above findings in accordance with the clear provisions of law in the Act, there does not remain any necessity of referring to various authorities cited at the bar on behalf of the applicant. But still as the learned counsel appearing for him has been at great pains to refer to them, we think it advantageous to discuss them as well. The case of Ms. K. M. Bros. Sujangarh, Appeal N0. 226 of 1958. decided by the learned Commissioner, Sales Tax, Udaipur : the only point decided therein is that the obtaining of the registration certificate alone is not sufficient to charge any dealer with liability to pay tax. It has some bearing on the present case. The learned Dy. Commissioner Sales Tax (Appeals) has made a reference in his order that the applicant was liable to pay tax only because of his obtaining the registration certificate willingly. This proposition is certainly not entirely correct in law as expalined above. (1956) VII S. T. C. 1265 : This is a case under the Madras Sales Tax Act in which the assessee was prosecuted and convicted for not paying the Registration fee under sec. (8)- (a) ok that Act. It was held, in view of certain Govt. Notification therein, that the petitioners were not liable to be convicted for non-payment of the registration fee. The decision therein does not go to help the applicant. On the other hand the following observations in the first para of that judgment go against his case: "they are commission agents. Under sec. 14-A they are deemed to be dealers within the meaning of the Act. In respect of their business they are liable to be assessed irrespective of the amount of the turnover of the business being less than the minimum specified in sec. 3 clause (3 ). Under sec. 8 B of the Act taxes can be collected only from those who are registered dealers and, therefore, under sec. 1-A the petitioners have to get themselves registered whatever the amount of turn over is, as under sec. 14 A they are liable to assessment irrespecsive of the amount of the turnover. " (1957) VIII S. T. C. 439 : This is a case under the Madhya Bharat Sales Tax Act, 1950. The point in dispute therein was that the dealer was both an importer of cycle-parts as well as a dealer in betel leaves. The Sales Tax authorities wanted to assess him for the combined dealings in both, when under the relevant provisions of the Act as an importer he could be made "liable to pay tax" only when the amount of turnover under that head exceeded Rs. 5000/ -. It was held that as the dealers were divided in 3 categories- (1) dealers in imported goods, (2) dealers in manufactured goods and (3) other dealers, and separate limits were prescribed for all the 3 categories, the 'liability to pay tax' was to be determined on the basis of the turn-over for the particular kind of dealing itself and not on the combined total of all of them. The question whether the assessment should be made or not even when the "taxable turnover" in the "assessment year" did not exceed the limit prescribed for the "liability to pay tax" was not at all under consideration in that case. (1959) X S. T. C. 449 : The case is again not at all relevant to the present case. The only points involved therein were as to whether goods sent by rail outside the State could be deemed to have been sold for the purposes of assessment to sales-tax and realisation of sales tax from customers by the dealer would preclude him from getting refund of the tax paid to the State under the Madras General Sales Tax Act, 1939 or not. To conclude; the registration as well as the falling short of the quantum of the turnover from the maximum limit prescribed in sec. 3 of the Act would not be the guiding factor for the assessment. The "liability to pay tax "would depend upon the exceeding of the limit prescribed by sec. 3 (1) during the "previous year" or the "assessment year" if the dealer had no business in the "previous year" or was not found "to be liable to pay tax" under sub-sec. (1 ). But the assessment would be determined by the quantum of the actual "taxable turnover" during the assessment year itself. The applicant has, therefore, been rightly assessed to tax; and this revision is hereby rejected as being without any force. .;