Tax-exempt goods and dealer registration: no annual fee where sales are wholly exempt from tax.

Dealers selling wholly exempt goods were held not bound to obtain registration or pay the annual registration fee, even though they were deemed dealers for assessment purposes. The court reasoned that registration provisions are linked to liability to sales tax; where the goods are completely exempt and no tax is payable, the basis for registration and fee liability disappears. Section 8-A(2) was treated as applicable only where sales are normally taxable but fall below the turnover threshold, not where there is complete exemption. Convictions for non-payment of the registration fee were therefore unsustainable.

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Issues: Whether dealers in goods exempted from sales tax, though deemed to be dealers and liable to assessment under the Act, were bound to obtain registration and pay the annual registration fee under the registration provisions.

Analysis: The petitioners carried on business in vegetables and fruits, which stood exempted from sales tax under the relevant Government Order. Although they were deemed to be dealers under section 14-A and the Act contemplated registration for collection of tax from registered dealers, the Court held that the purpose of registration was tied to the liability of sales to tax. Where the goods themselves were wholly exempt and no tax was payable at all, the rationale for registration and the annual fee disappeared. Section 8-A(2), which dealt with cancellation of registration, was held to apply to cases where sales were ordinarily taxable but fell below the minimum turnover, and not to cases of complete exemption.

Conclusion: The petitioners were not liable to get themselves registered or to pay the annual registration fee, and their convictions for non-payment of the registration fee could not be sustained.

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