1959 (7) TMI 42 - HC - VAT and Sales Tax

Court upholds pre-Constitution tax collection, dismisses prohibition petitions under Article 226.

PV. Mohammed Versus The Collector of Palghat

The High Court dismissed the original petitions seeking writs of prohibition against sales tax collection on pre-Constitution inter-State transactions, ... - Issues:Petitioner seeking writs of prohibition for sales tax collection on inter-State transactions pre-Constitution period.Analysis:The petitioner, a dealer in untanned hides and skins, contested sales tax assessments for the years 1947-48 and 1948-49 before the Additional First Class Magistrate, Palghat. Convicted in both cases, he was ordered to pay fines and taxes. Despite unsuccessful attempts to modify or cancel the orders, the Collector initiated execution proceedings in 1958. The petitioner argued that inter-State sales were exempt from tax based on a Supreme Court decision and a Press Note by the State of Madras. The Collector contended that the Constitution's Article 286 did not apply to pre-Constitution period assessments, making the sales tax valid. The High Court held that Article 286 did not bar pre-Constitution tax collection and assessments' finality prevented reevaluation under Article 226. The Press Note mentioned by the petitioner was deemed irrelevant as it pertained to post-Constitution transactions. Consequently, the petitions seeking relief were dismissed with costs.Conclusion:The High Court dismissed the original petitions seeking writs of prohibition against sales tax collection on pre-Constitution inter-State transactions, emphasizing the inapplicability of Article 286 to assessments made before the Constitution's enactment. The finality of past assessments precluded reexamination under Article 226, and the Press Note cited by the petitioner was deemed irrelevant to the case. The court upheld the validity of the tax collection, leading to the dismissal of the petitions with costs.