1997 (3) TMI 494 - SCH - VAT and Sales Tax

Appellant not liable for purchase tax on converting dry bones to bone-meal under Sales Tax Act

The Supreme Court held that the appellant is not liable to pay purchase tax for converting dry bones into bone-meal for sale under the Kerala General ... Whether the appellant who purchases dry bones and converts them into bone- meal for sale as such in the market can be said to be liable to pay purchase tax under section 5A(1) of the Kerala General Sales Tax Act, 1963? Held that:- Appeal allowed. This question is resolved in favour of the assessee and against the Revenue by the decision of the Madras High Court in State of Tamil Nadu v. Subbaraj and Co. [1980 (9) TMI 253 - MADRAS HIGH COURT ]. The appeal lodged against this decision of the Madras High Court was dismissed in limine by this Court. Therefore, this decision of the Madras High Court is holding the field since it came to be decided on September 23, 1980. Having regard to the fact that this Court rejected the special leave petitions filed questioning the correctness of the view taken in this case, we also do not see any reason why we should take a different view. The Supreme Court held that the appellant converting dry bones into bone-meal for sale is not liable to pay purchase tax under the Kerala General Sales Tax Act, 1963. The decision of the Madras High Court in State of Tamil Nadu v. Subbaraj and Co. supports this, and the Supreme Court dismissed appeals against it. The Supreme Court allowed the appeals, set aside the High Court's order, and restored the view of the Appellate Tribunal.