Licensed dealer cannot claim unlicensed status later, and exemption for purchases from unlicensed dealers must be strictly proved.

A dealer who obtained a licence under the taxing scheme could not, after operating under it, unilaterally claim retrospective treatment as an unlicensed dealer to avoid the balance licence fee or the statutory consequences of default. Purchases said to have been made in shandies did not by themselves prove that the sellers were unlicensed dealers, so the exemption had to be strictly proved by the assessee and was unavailable on the facts stated. Once the licence fee was finally assessed and demanded, the balance fee became a recoverable liability under the Act.

---

---

Issues: (i) Whether a dealer who obtained a licence and was later called upon to pay the balance of the licence fee could insist on being treated as an unlicensed dealer. (ii) Whether purchases made in shandies from sellers whose names and addresses were not disclosed were proved to be purchases from unlicensed dealers so as to attract exemption. (iii) Whether the balance of the licence fee assessed after finalisation of turnover was recoverable under the taxing law.

Issue (i): Whether a dealer who obtained a licence and was later called upon to pay the balance of the licence fee could insist on being treated as an unlicensed dealer.

Analysis: The statutory scheme treated the licence as a means of obtaining the benefit of single-point taxation and related concessions, subject to compliance with the prescribed conditions and payment of the balance fee after final assessment. Failure to pay the balance fee or to comply with the conditions did not entitle the dealer to unilaterally withdraw from the licensed regime after having carried on business under it. The law contemplated cancellation of the licence or loss of concession as a consequence of default, not a retrospective election by the dealer to be treated as unlicensed at his own choice.

Conclusion: The dealer had no right to demand treatment as an unlicensed dealer after obtaining and operating under the licence.

Issue (ii): Whether purchases made in shandies from sellers whose names and addresses were not disclosed were proved to be purchases from unlicensed dealers so as to attract exemption.

Analysis: The exemption claimed by a licensed dealer in respect of purchases from unlicensed dealers had to be strictly established by the assessee. Proof that purchases were made in shandies did not by itself establish that the sellers were unlicensed dealers, because licensed and unlicensed dealers could both operate there. In the absence of evidence that the sellers were unlicensed dealers, and especially where the assessee failed to prove a part of the alleged purchases, the burden of proving entitlement to exemption was not discharged.

Conclusion: The assessee failed to prove that the purchases were from unlicensed dealers, and the exemption was not available.

Issue (iii): Whether the balance of the licence fee assessed after finalisation of turnover was recoverable under the taxing law.

Analysis: Once the licence fee was finally assessed and a demand was issued, the amount became due under the Act. The taxing statute treated non-payment of such fee as a default attracting consequences, and the demand created a recoverable liability. The revenue recovery machinery was available for sums due to the State, and the balance of the licence fee did not cease to be recoverable merely because it was described as a fee rather than a tax.

Conclusion: The balance of the licence fee was recoverable from the assessee.

Final Conclusion: The assessee was liable to be assessed and could not avoid the licensed-dealer regime after obtaining the licence, failed to establish the claimed exemption on purchases from unlicensed dealers, and remained liable for the balance licence fee.

Ratio Decidendi: A dealer who has obtained a licence under a taxing scheme cannot, after carrying on business under that licence, unilaterally claim retrospective treatment as an unlicensed dealer to evade the balance licence fee or the statutory consequences of default; exemptions based on purchase from unlicensed dealers must be strictly proved by the assessee.

---