Exemption for goods in Cochin State failed where the assessee could not prove location at contract date.

Exemption under Notification No. 1011 dated 28 May 1949 applied only where, at the time the contract of sale or purchase was made, the goods were actually in Cochin State. The assessee, treated as the first dealer under Rule 4A(1) read with Rule 4(1) of the Turnover Rules, had to prove that condition to qualify for relief on cotton yarn purchased in Cochin State and sold in Madras State. The evidence was found insufficient to establish that the goods were in Cochin State when the agreements to sell were entered into, so the exemption claim failed.

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Issues: Whether the assessee was entitled to the exemption under Notification No. 1011 dated 28th May, 1949 in respect of cotton yarn purchased in Cochin State and sold in Madras State.

Analysis: The notification exempted goods from tax only if, at the time the contract of sale or purchase was made, the goods were actually in Cochin State. The assessee was liable as the first dealer under Rule 4A(1) read with Rule 4(1) of the Turnover Rules unless the exemption applied. The determining fact was whether the assessee proved that, when the agreements to sell were entered into, the goods were actually in Cochin State. The evidence was found insufficient to establish that requirement.

Conclusion: The assessee failed to prove entitlement to the exemption, and the claim was rightly rejected.

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