Separate account requirement under sales tax law satisfied by distinct ledgers, preserving exemption despite one chitta and return omissions.

Separate account maintenance under rule 12(3) was satisfied where the taxpayer kept distinct ledgers for commission agency business and personal dealings, even though both appeared in one chitta. The rule required separate accounts, not two separate account books, and the entries showed the transactions were identifiable and independently recorded. Omission to fill column 5 in some returns was immaterial because the returns still disclosed gross and net turnover. Cross-examination admissions did not override the documentary finding. On that basis, the taxpayer was held to have complied with rule 12(3) and remained entitled to the exemption and refund claimed.

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Issues: Whether the respondent complied with rule 12(3) by maintaining separate accounts for commission agency transactions and personal dealings, and was therefore entitled to exemption under section 8 of the Madras General Sales Tax Act.

Analysis: The respondent kept separate ledgers for commission business, and although both classes of transactions appeared in a single chitta, they were distinct and identifiable. Rule 12(3) did not require two separate account books, only separate accounts. The omission to fill column 5 in certain returns was immaterial in view of the nature of the returns and the entries showing gross and net turnover. The admissions in cross-examination did not displace the finding that the transactions were separately recorded. The authority applied the same reasoning followed in an earlier decision on identical facts.

Conclusion: The respondent had not violated rule 12(3) and remained entitled to the exemption and refund claimed.

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