Sales tax liability at enhanced rate cannot be avoided because sellers collected only part of the tax from customers.

Outside manufacturers remained statutorily liable to collect and deposit sales tax at the enhanced 8% rate. Their decision to collect only 4% from customers was voluntary and did not create any legal right to avoid the balance liability. The earlier Supreme Court ruling striking down the local manufacturers' exemption prospectively, with a bar on refund, did not assist them because it only restricted refund claims by exempted manufacturers and did not extinguish the independent tax obligation of outside manufacturers. As the levy and enhanced rate were never held unlawful and no interim protection prevented full collection, the demand for the remaining tax was upheld.

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Issues: Whether the appellants could avoid payment of the balance sales tax at 8% on the ground that they had collected only 4% from customers and that the exemption granted to local manufacturers had been struck down prospectively with a bar on refund.

Analysis: The appellants remained statutorily liable to realise and deposit sales tax at the enhanced rate of 8% throughout. Their failure to collect the full tax from customers was a voluntary act and did not create any legal entitlement to be relieved of the balance liability. The earlier decision invalidating the local exemption and moulding relief under Article 142 did not assist them, because that decision only prohibited refund claims by the exempted manufacturers and did not cancel the independent tax obligation of outside manufacturers. Since the levy and enhanced rate were never found unlawful and no interim protection had prevented collection of tax at the full rate, there was no basis to direct that the remaining 4% need not be paid.

Conclusion: The appellants were not entitled to any exemption from paying the balance sales tax, and the demand for the remaining amount was upheld against them.

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