ONKARLAL NANDLAL versus STATE OF RAJASTHAN & ANR.

ONKARLAL NANDLAL versus STATE OF RAJASTHAN & ANR.

Explanation II to sub-section (o) of section 2 of the Rajasthan Sales Tax Act, 1954, as incorporating sub-section (2) of section 4 of the Central Sales Tax Act, 1956, deems a sale to have been made within the State if the specified goods are in the State at the time of the sale contract; thus, resales by the assessee were within the State according to law, notwithstanding that they were sales in the course of inter-State trade—the only consequence being that such sales are not taxable under State legislation but may be taxable by the Central Government.

Parties
Appellant: ONKARLAL NANDLAL; Respondents: STATE OF RAJASTHAN & ANR.
Jurisdiction
India
Judgment Date
23 September 1985
Procedural Posture
Civil Appeal / Appeal by Special Leave From Order of Commercial Tax Officer, Jhalawar
Outcome
Appeals allowed.
Legal Topics
Sales Tax, Interpretation of Statutes, Rule of Incorporation, Practice and Procedure on Appeals
Taxation Law Sales Tax Interpretation of Statutes Rule of Incorporation Practice and Procedure on Appeals

Case Brief

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Parties

ONKARLAL NANDLAL

Appellant

STATE OF RAJASTHAN & ANR.

Respondents

Procedural Posture

Civil Appeal / Appeal by Special Leave From Order of Commercial Tax Officer, Jhalawar

Legal Issues

  1. 1 Whether resale of goods in the course of inter-State trade can be regarded as resale within the State for the purposes of Rajasthan Sales Tax Act, 1954.
  2. 2 Effect of incorporating sub-section (2) of section 4 of the Central Sales Tax Act, 1956 into Explanation II of section 2(o) of Rajasthan Sales Tax Act, 1954.

Ratio Decidendi

Explanation II to sub-section (o) of section 2 of the Rajasthan Sales Tax Act, 1954, as incorporating sub-section (2) of section 4 of the Central Sales Tax Act, 1956, deems a sale to have been made within the State if the specified goods are in the State at the time of the sale contract; thus, resales by the assessee were within the State according to law, notwithstanding that they were sales in the course of inter-State trade—the only consequence being that such sales are not taxable under State legislation but may be taxable by the Central Government.

Court Disposition

Appeals allowed.

Orders

  • Assessments including the purchase price of poppy seeds in taxable turnover set aside to the extent related to purchases against Declarations in Form No. ST 17.
  • Respondents to pay costs to the assessee throughout, including costs of the appeal.