K R C S BALAKRISHNA CHETTY AND SONS AND COMPANY Vs. SATE OF MADRAS

JUDGEMENT

(1.) THE following Judgment of the court was delivered by :

(2.) TWO suits were brought by the appellants for a declaration against the levy of sales tax by the State of Madras and an injunction was also prayed for. Both the suits were decreed by the Subordinate Judge of Salem and the decrees were confirmed on appeal by the District Judge of Salem. TWO appeals were taken to the High court by the State of Madras against those decrees and by a judgment dated 18/02/1955, the decrees were set aside by a common judgment. Against these decrees the appellants have brought these appeals by a certificate of that court.

(3.) UNDER B. 13 an important condition imposed under the Act is the keeping by the dealer and every person licensed of true and correct accounts showing the value of the goods sold and paid by him. Next there is r. 5 of the General Sales Tax Rules which provided that if any person desired to avail himself of the exemption provided in s. 5, he had to submit an application in Form I for a licence and the Form of the licence shows that the licence was subject to the provisions of the Act and the rules made thereunder which required the licensee to submit returns as required and also to keep true accounts under s. 13. This shows that the giving of the licence was subject to certain conditions being observed by the licensee and the licence itself was issued subject to the Act and the rules. But it was contended that the words `subject to` do not mean `conditional upon` but `liable to the rules and the provisions` of the Act. So -construed s. 5 will become not only inelegant but wholly meaningless. On a proper interpretation of the section it only means that the exemption under the licence is conditional upon the observance of the conditions prescribed and upon the restrictions which are imposed by and under the Act whether in the rules or in the licence itself ; that is, a licensee is exempt from assessment as long as he conforms to the conditions of the licence and not that he is entitled to exemption whether the conditions upon which the licence is given are fulfilled or not. The use of the words `subject to` has reference to effectuating the intention of the law and the correct meaning, in our opinion, is `conditional upon`.