K MOHAMED ELIAS AND CO Vs. STATE OF MADRAS

JUDGEMENT

(1.) THE assessments in these three cases relate to the assessment year 1957-58. Though the petitioners are different, certain common questions arise.

(2.) IN T. C. No. 171 of 1960, the assessee was assessed to central sales tax on a total turnover of Rs. 4,28,735 of which Rs. 2,45,162 was taxed under Section 8 (2)of the Act at two per cent on the turnover. In T. C. No. 172 of 1960, Rs. 1,62,705 was brought to tax at two per cent out of the total turnover of Rs. 2,03,281. In T. C. No. 173 of 1960, Rs. 34,369 was taxed at two per cent out of the total turnover of Rs. 76,879. The other parts of the turnovers in each of these cases was taxed at one per cent under Section 8 (1) of the Act. All the petitioners are dealers in hides and skins.

(3.) IN all of these cases, Mr. Karim, for the petitioners, advances the argument that the tax itself has not become exigible under the Central Sales tax Act by reason of the following circumstances. Section 6 of the Central Sales Tax Act which imposes a liability to tax under that Act was brought into operation by a notification of the central Government issued on 26th March 1957, the levy itself was to take effect from Ist July 1957. All the sections of the Central Sales Tax Act were not brought into operation at the same time. Section 15 in particular, which imposed certain restrictions and conditions in regard to tax on sales and purchases of declared goods, was brought into force with effect from ist October 1958, that is, on a date outside the assessment year in question. Chapter IV of the Central Sales-tax Act deals with goods of special importance to inter-State trade or commerce. Section 14 of the Act sets out the classes of such goods. Section 15, as indicated already, imposed certain restrictions upon the State sales tax law in so far as it purported to levy any tax under that law in respect of the sales or purchases of declared goods set out in Section 14. Broadly stated, the contention is that Sections 6, 14 and 15 form as it were a composite group and that having regard to the scheme and object of the Act, enforcement of the levy of the Central Sales tax under section 6 of the Act is not possible, unless the contemplated restrictions under sections 14 and 15 are brought into force at the same time. It is claimed that the intention of the Parliament was that simultaneously with the imposition of levy of central sales tax, the safeguards contemplated by Sections 14 and 15 of the Act should also be made effective. It is contended therefore that since Section 15 was brought into force only with effect from Ist October 1958, any earlier operation of section 6 of the Act is not in conformity with the underlying object of the Act.