LexTHE STATE OF MADRAS AND ANOTHER versus M/S. M. A. NOOR MOHAMMED AND CO.
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148 SliPREME COURT REPORTS [1961] i960 answered in the affirmative in respect of sale of a.II . -. . goods where the price has been received by the S.K.F. 1 he Comm1moner · th t bl · d · · f' h h of Income-ta<. ill e 8.:KB e territory, a.n 1rrespect1ve 0 W et er Bombay • the remittance has been made in respeut of the goods v. sold before or after the price wa.s received. s. K. F. Ball The a.ppoa.l is accordingly allowed to the extent Btaring Co· Ud. indicated. The appellant will be entitled to his costs Sllah ]. in this court a.nd also the costs of the reference in the High Court. Appeal partly allowed. 1960 THE STATE OF MADRAS AND ANOTHER v. M/a. M. A. NOOR MOHAMMED AND CO. (B. P. SrnHA, C. J., J. L. KAPUR, P. B. GAJENDRA· GADKAR, K. SuBBA RAO a.nd K. N. WANCHOO, JJ.) Sales Tax-Sale of hides and ski11s-Exemption from 'multiple taxation-U11licensed dealers-Whether can claim single point taxa. lion-Validity of mies providing for multiple taxation-Madras General Sales Tax (Turnover and Assessmrnt) Rules, 1939, r. 16(5) -Madras General Sales Tax Act, 1939 (9 of 1939), ss. J, 5(vi), 6A. The respondent, a firm carrying on tannery business, used to take out licences under the provisions of the Madras General Sales Tax Act, 1939, but did not renew the licence for the assess- ment year, 1952-1953, and was assessed to sales tax on the sale value of tanned hides and skins during the year. It challenged the validity of the order of assessment by filing a petition before the High Court under Art. 226 of the Constitution of India, on the grounds that under s. 5(vi) of the Act the liability to pay sales tax in respect of hides and skins could only be at a single point, that r. 16(5) of the Madras General Sales Tax (Turnover and Assessment) Rules, 1939, which limited the operation of this mode of taxation to licensed dealers \\'as ultra vircs as it con- travened s. 5(vi) and had been so held in V. M. Syed M ohamm- ed & Co. v. The S'tate of Madras, [19541 S.C.R 1117, and that s. 6A was not applicable to the case of a dealer which did not take out a licence . . Held, thats. 3 of the Madras General Sales Tax Act, 1939, envisages multipoint taxation on the total turnover of a dealer, f 1 S.C.R. SUPREME COURT REPORTS 149 but under s. 5 an exception is made in the case of sale transac- z960 tions of certain specified goods, providing for single point taxa- tion subject to certain restrictions and conditions W·b,iGh include State of Madras conditions as to licences, and if the colldiiions and· festrictions v. are not complied with, under s. 6A the tax is to be levied under M.A. No°' s. 3 as if the provisions of s. 5 did not apply to such sales. Accor-Mohammed & Co. dingly, r. 16(5) of the Madras General Sales Tax (Turnover and Assessment) Rules, 1939, is not iiltra vires. Syed Mohamed & Company v,State of Andhra, [1956] 7 S.T.C. 465 and State of Mysore v. Sarvatula & Co., [1957] 9 S.T.C. 593, approved. V. M. Syed Mohammed & Company v. The State of Madras, [1957] S.C.R. 1II7, explained. 0 CIVIL APPELLATE JURISDICTION: Civil Appeal No. 38 of 1959. Appeal by special leave from the judgment and order dated April 2, 1956, of the Madras High Court in Writ Petition No. 313 of 1954. R. Ganapathy Iyer and T. M. Sen, for the appe!. !ants. C. K. Daphtary, Solicitor-General of India and S. Venkatakrishnan, for the respondents. A. V. Viswanatha Sastri and S. Venkatakrishnan, for Intervener No. 1 (Ambur Tanners AsRociation). R. Gopalakrishnan, for Interveners Nos. 2 and 3 (R. Ohennappa and P. Abdul Wahab). 1960. August 12. The Judgment of the Court was . delivered by KAPUR J.-This is an appeal by special leave Kapur J. against the judgment and order of the High Court of Madras allowing a petition under Article 226 of the Constitu·tion. The question there raised was the lega- lity of the assessment of Sales Tax by appellant No. 2, the Deputy Commercial Sales Tax Officer, Saidapet, under the Madras General Sales Tax Act, 1939 (Act IX of 1939), hereinafter termed the Act. The respondent was a partnership firm carrying on tannery business at Chromepet near the city of Madras. Before the year of assessment, i. e., 1952-53, it was taking out licences under the relevant provisions of 150 SUPREME COURT REPORTS [l!l6l] 196o the Act but it did not renew the licence for the assess- ment year. When called upon to make a return it did State of Madras d d"d
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