Single point taxation for hides and skins cannot be withdrawn by a dealer licence condition under the sales tax scheme.

Single point taxation for hides and skins under the Madras General Sales Tax Act is commodity-based and cannot be defeated by a dealer-specific licence condition. The charging provision in section 3 yields to section 5(vi), which requires tax only at one point in the sales chain; a rule that taxes an unlicensed dealer on each sale, or withdraws the benefit of single point levy unless a licence is taken out, is inconsistent with that statutory scheme and invalid. Section 6-A does not apply unless a prescribed condition under section 5 is contravened or a licence requirement is breached. The practical effect is that an unlicensed dealer is not liable to multi-point taxation merely for lack of licence.

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Issues: Whether an unlicensed dealer in untanned hides and skins was liable to tax on the sale turnover under the Madras General Sales Tax Act and the rules, and whether the licence condition in the rules could validly deny the benefit of single point taxation.

Analysis: Section 3 is the charging provision, but in the case of hides and skins it is controlled by section 5(vi), which requires taxation only at a single point in the series of sales. The earlier Full Bench decision established that the single point for licensed dealers is fixed by the relevant turnover and assessment rules and that rule 16(5), which attempted to tax sales by unlicensed dealers on each occasion of sale, was repugnant to section 5(vi) and therefore invalid. The same principle governs rule 5 of the General Sales Tax Rules: a condition that makes the commodity's entitlement to single point taxation depend on the dealer taking out a licence is inconsistent with the statutory scheme, because the restriction under section 5(vi) is commodity-based and not meant to be defeated by a personal disqualification of the dealer. Section 6-A also did not assist the Revenue, because it applies only where a prescribed condition under section 5 is contravened, where a licence is required but not taken out, or where licence conditions are breached, none of which fit the present scheme for hides and skins.

Conclusion: The unlicensed dealer was not liable to be taxed on each sale turnover merely because no licence had been taken out, and the impugned assessment could not be supported under rule 5 or section 6-A.

Ratio Decidendi: Where a statute provides single point taxation for a commodity, the rule-making power cannot impose a dealer-specific condition that withdraws that commodity-based benefit and converts the levy into multi-point taxation.

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