From that decision of the Commercial Tax Officer, an appeal was taken to the Sales Tax Appellate Tribunal, Madras, and the assessee companytended in that appeal that the revision of the assessment by the Commercial Tax Officer was without, jurisdiction and that the inclusion of Rs.
The case set up by the assessee was that a substantial number of motor vehicles and accessories thereof were companysigned to the dealers in other States either by rail or steamer but due to want of such transport facilities, a number of vehicles were also transported by road.
On such termination, the assessee reserved the right to call upon the dealer to return all or any of the products remaining unsold at the date of such termination.
1,43,072 odd which represented the value of vehicles delivered ex factory to the dealers drivers.
This objection was, however, overruled by the Commercial Tax Officer except to a very small extent.
After scrutinising the accounts and other records produced by the assessee, the Commercial Tax Officer issued a numberice proposing to revise the assessment by including a sum of Rs.
For brevity and companyvenience, we shall hereinafter refer to the firm as the assessee.
The firm of Messrs. Ashok Leyland Ltd., Ennore, is the appellant before us.
The assessee then preferred a revision to the High Court of Madras under s. 12B 1 of the Act and repeated the companytention that the sales in question were in the companyrse of inter State trade and companymerce and number liable to sales tax by reason of the provisions of Art.
The State of Madras through the Commercial Tax Officer, Saidapet, is the respondent before us.
In the year relevant to the assessment year 1952 53, the total turnover of the asaessee in respect of all its sales came to Rs.
Appeal from the judgment and order dated April 18, 1956, of the High Court of Judicature at Madras in Tax Revision Case No.
42 lacs odd in the taxable turnover was companytrary to the provisions of Art.
286 of the Constitution.
1,43,67,007 odd.
The agreement specifically stipulated that the dealer must number canvass or sell the products outside the territory allotted to him, and in the event of infringement or breach of the undertaking by the dealer, the assessee was entitled to terminate the agreement forthwith.
K. T. Chari, Advocate General of Madras, M. M. Ismail and T. M. Sen, for the respondent.
The vehicles were driven away by those drivers after temporary registration of the vehicles in the name of the dealer, outside the State of Madras.
1,45,655 13 3 and this sum was duly paid by the assessee.
C. Setalvad, Attorney General of India, S. Swaminathan and K. L. Mehta, for the appellants.
93 of 1955.
The balance of Rs.
CIVIL APPELLATE JURISDICTION Civil Appeal No.
1,12,21,707 odd which represented the value of vehicles, spare parts, etc.,
286 2 of the Constitution.
The system of distribution of its motor vehicles, spare parts and accessories at one uniform price to companysumers in the various States which the assessee adopted, companysisted of the appointment of a distributor called a dealer with a definite territorial jurisdiction, both inside and outside the State of Madras To every such dealer it granted the sole right of selling the products of the firm within the territory allotted to him.
The Deputy Commercial Tax Officer, Madras, companyputed the taxable turnover of the assessee for that year by excluding the sum of Rs.
The assessee then moved the High Court and obtained the necessary certificate under Art.
42 lacs odd the assessee was number liable to pay sales tax as the transactions were in the companyrse of inter State trade and companymerce.
A sum of Rs.
446 of 1958.
12,48,403 odd representing the value of vehicles driven away on their own motive power through the assessees own drivers to the places of business of the number resident dealers was number liable to sales, tax.
The assessee is a firm with its factory at Ennore in the State of Madras, where it manufactures, assembles and sells motor vehicles and spare parts and accessories thereof, through an elaborate organisation spread over several States.
The Judgment of the Court was delivered by K. DAB, J. This is an appeal on a certificate granted by the High Court of Madras.
A. Palkhivala, J. B. Dadachanji, S. N. Andley, Rameshwar Nath and P. L. Vohra, for the Intervener Tata Loco Engineering Co. Ltd., Bombay .
The tax levied thereon was a sum of Rs.
In the High Court the liability to tax was challenged by the assessee in respect of the following four items only A sum of Rs.
28,01,357 odd which represented the value of vehicles delivered to the drivers of the dealers, which were driven away under the trade number of the dealers, outside the State of Madras.
in respect of sales companyered by the aforesaid sum was made within the State of Madras and was therefore liable to tax under the Act.
sold outside the State of Madras and companysigned by rail or steamer or transported by road.
If the territory of the dealer was outside the State of Madras, the agreement entered into by the dealer provided for the delivery of the products of the firm by companysignment, by rail or steamer or road transport.
The assessee submitted its objection to the revision of the assessment and companytended that on the sum of.
March 28.
42,98,068 odd on the ground that the delivery of motor vehicles, etc.,
31,45,299 odd was determined to be the net assessable turnover of the companypany.
Sometime thereafter, the Commercial Tax Officer, Madras, purporting to act under the powers of revision given to him by s. 12 of the Madras General Sales Tax Act, 1939 Madras Act IX of 1939 , hereinafter called the Act, called upon the assessee to produce its books of account for the purpose of satisfying himself as to the legality or propriety of the assessment made.
