M/S. KANPUR VANASPATI STORES, KANPUR versus THE COMMISSIONER OF SALES TAX, U.P. LUCKNOW

Citation: [1973] 3 S.C.R. 424 · Decided: 22-01-1973 · Supreme Court of India · Bench: K.S. HEGDE · Disposal: Dismissed

Judgment (excerpt)

424 
M/S. KANPUR VANASPATI STORES, KANPUR 
v. 
THE COMMISSIONER OF SALES TAX, U.P. LUCKNOW 
January 22, 1973 
A 
[K. S. HEGDE, P. JAGANMOHAN REDDY AND H. R. KHANN,\ J.J.] 
B 
U.P. Salts Tax Act, Sec. 3A : (•successivt Dealer". whether includes 
an importer who is the first cleal". U,f. Scles 
Tc~• Act, Sec. 9(1) 
proviso; "tax adn1itted"-Whether restricted to ad1nission in 111e111oran· 
dum of apptal only. 
The assessee, among other things, imports and distributes vanaspati 
as agent of certain compa:nies.. 
For the year 1957-58, he filed a return 
on a turn over of Rs. 1,66,387.3 P and 
paid tax 
of Rs. 1060.30. 
Before the assessing authority, he accepted the liability of Rs. 10,331H9 p. 
On independent enquiries, the Sales Tax Officer came to the conclusion 
that the turn over was Rs. 58,06,132.31) and the tax liability was to 
the extent of Rs. 3,62,691. 62P. The tax authority had to resort to best 
·assessment, as the assessce failed to appear, although 30 adjour.nments 
were given. The assessee filed an appeal to the 
appellate 
authority 
without depositing the tax, as required by proviso to Sec. 9 of the Act. 
The appeal was dismissed for non·compli®ce of Sec. 9. 
At the inst an~ 
.of the assessee, the question of maintainability of 'IJ'peal was referred 
to the High Court. During the pendency of the reference, the asses.,e 
filed wnt petitions challeinging the validity of the 
Notification issued 
under section 3A and the legality of the proceedings. The High Court 
htld that the appeal was properly dismissed. Before this 
Court. 
the 
following questions were raised : (i) that the assessee-appellant being an 
importer cannot be considered as one of the successive dealers in 
the 
series of sales as contemplated by Section 3A aind, therefore, the Noti-
fication under section 3(A) was ultra vires, and (ii) that the dismissal 
of appeal, for want of payment of the admitted tax under section 9( I) 
,of the Act was illegaL 
Dismissing the appeal, 
HELD : (i) An importer is one of the dealers. 
He 
is 
the 
first 
deal.er in the State. 
Chain of successive dealers begins from the first 
dealer and it goes to the 1ast dealer. 
In view of this, 
dealer 
in 
this 
chaiu can be considered as a "suc'cessive dealer". 
The series does not 
begin in the middle. The notification undelr section 3 is a valid noti-
fication 
Ram Ku1nar Rajendra Swaroop Vs. Co111111issjoner 
of 
Sr.fes 
Tax (19 S.T.C. 241) approved. [4266 C-DJ 
(ii) Th.e assessee had accepted the liability of Rs. 10,339/- before 
the tax authorities. Under Rules 41 (2) read with 12 he was 
bound 
to submit the quarterly return and also deposit the tax due in accordance 
with the return. 
The expression "tax'. admitted" in proviso . to 
Sec-
tion 9(1) means tax admitted before the assessing authority and 
not 
hefore the appellate authority. A• par,ment of the admitt,ed tax is one 
of the cond1tlons for the maintainab11itv of the appenl, Section 9(1) 
would be rendered wholly useless, if it is interpreted 
to 
me:in 
ta~ 
·admitted in the memorandum of appeal. Ordinarily. no interpretation 
•hould be placed on a provision which would have the effect of mnkin11 
!he provision either otiose or a dead letter. [4260-H; 427A-DJ 
c 
D 
E 
F 
G 
H 
.\ 
c 
D 
E 
F 
G 
H 
KANPUR VANASPATI V. c.s:T. (Hegde. J.) 
425 
Chanshyam Dass Balmukand v. The State of U.P. 
& 
Ors. 
(23 
S. T.C. 282) and United Timber & Cmheu• Products (P) Ltd. v. Sales 
1'ax Officer. Cannanor< (28 S.T.C. 526), overruled. 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2300 to 
2302 of 1969 and 14 & 15 of 1970. 
Appeal by a special leave from the judgment dated August 7, 
1968 and 18th August 1969 in Sales Tax Reference No. 574 of 
J 963. and Special appeal No. 330 of 1963, Misc. Application 
No. 177 of 1963 and S.A. Nos. 423 and 424 of 1968 respect-
ively. 
S. V. Gupte, K. L. Arora, S. K. Bagga and S. Bagga, for the 
nppellant. 
N. D. Karklzanis and 0. P. Rana, for the respondent. 
The Judgment of the Court was delivered by 
HEGDE, J, 
These are appeals by special leave. 
They are 
filed by the same assessee. 
They arise from the decision of a 
Division Bench of the Allahabad High Court. The judgment under 
appeal not only deals with references made under the U.P. Sales 
Tax Act 1948 (hereinafter referred to as the Act) but also the two 
Writ Petitions filed by the assessee. 
The assessee who is a registered dealer under the Act is having 
his business at Kanpur. It carries on business in hydrog

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