Single-point sales tax levy: subsequent consumer sales escaped tax where first-stage tax had already been paid and certificates were produced.

Section 5(1-A) of the Punjab General Sales Tax Act, 1948 was construed as a single-point levy on the first stage sale of the specified goods, with the proviso operating as an exemption for subsequent sales on production of the prescribed certificates. The phrase "registered dealer from whom the goods were purchased" was read to mean the registered dealer from whom the goods were originally bought at the first taxable stage, not necessarily the immediate seller. On that interpretation, sales by the assessee to consumers were subsequent sales outside the taxable first stage, and the notification dated 30 March 1966 was treated as consistent with that position. The sales tax demand was therefore unsustainable.

---

---

Issues: Whether sales tax under section 5(1-A) of the Punjab General Sales Tax Act, 1948 was payable on the assessee's sales to consumers when the goods had already suffered tax at the first stage of sale and the assessee possessed the requisite certificates.

Analysis: Section 5(1-A) was held to embody a scheme of single point levy at the first stage of sale of the specified goods. The proviso was treated as an exemption provision for subsequent sales, subject to production of the prescribed documents. The phrase "registered dealer from whom the goods were purchased" was construed to refer to the registered dealer from whom the goods were originally purchased at the first taxable stage, not necessarily the immediate seller to the assessee. On that construction, the assessee's sales to consumers were subsequent sales outside the taxable first stage. The notification dated 30 March 1966 was also read as confirming that only the first stage sale in the described situation was taxable.

Conclusion: The assessee was not liable to pay sales tax on its sales to consumers, and the tax demand was unsustainable.

---