Sales tax on goods remained valid despite registration defects and did not become a corporation tax.

Registration machinery did not control the charging provision: liability arose from the tax on dealers whose turnover exceeded the taxable quantum, so an alleged defect in appointment of the registering authority or in the registration certificate did not invalidate the assessment. The levy was not a corporation tax, because it remained a tax on sales of goods and companies were affected only incidentally. The tax was also within the sales-entry legislative field, since turnover, sale price and related definitions showed that the consideration formed part of the sale transaction itself. The challenge to the assessment and legislative competence was rejected.

---

---

Issues: (i) Whether an alleged defect in the appointment of the registering authority or in the grant of the registration certificate vitiated the subsequent assessment. (ii) Whether the sales tax levied by the Act was in substance a corporation tax and therefore beyond the State Legislature's competence. (iii) Whether the levy was really on the consideration for the sale and not on the sale of goods so as to fall outside the relevant legislative entry.

Issue (i): Whether an alleged defect in the appointment of the registering authority or in the grant of the registration certificate vitiated the subsequent assessment.

Analysis: The liability to tax arose from the charging provision, which imposed tax on every dealer whose turnover exceeded the taxable quantum. The registration provisions were treated as machinery for effective collection and did not control or condition the existence of the tax liability. The Court also held that the validity of the registration was not material to the validity of the assessment, and the argument based on the alleged want of jurisdiction in the registering officer could not invalidate the assessment.

Conclusion: The objection failed and the assessment was not rendered invalid on the ground of defective registration.

Issue (ii): Whether the sales tax levied by the Act was in substance a corporation tax and therefore beyond the State Legislature's competence.

Analysis: A corporation tax, as defined in the relevant constitutional and statutory provisions, is a tax on income payable by companies subject to specified conditions. The impugned levy was examined in its true nature and substance, and the Court found that it was a tax on sales of goods, with corporations being affected only incidentally. The fact that the burden may fall on companies did not transform the levy into a tax on income or corporation tax.

Conclusion: The levy was not a corporation tax and the constitutional challenge failed.

Issue (iii): Whether the levy was really on the consideration for the sale and not on the sale of goods so as to fall outside the relevant legislative entry.

Analysis: The definitions of turnover, taxable turnover, sale, goods, and sale price showed that the tax was imposed on the transactions of sale of goods and on the sale price as an inseparable element of such transactions. The Court held that no real distinction could be drawn between taxing the consideration and taxing the sale itself for the purpose of the relevant entry, because the consideration is part of the sale transaction.

Conclusion: The levy was within the entry taxing sales of goods and the objection was rejected.

Final Conclusion: The challenge to the assessment and to the legislative competence of the sales tax law was rejected, and the reference was answered in favour of the taxing authority.

Ratio Decidendi: Machinery provisions for registration and recovery do not control the charging section, and a sales tax that operates on transactions of sale of goods does not become a corporation tax merely because companies may be among those taxed.

---