Section 5(2) tax liability on intra-State sales of declared goods applied despite turnover below the exemption threshold.

Section 5(2) of the Mysore Sales Tax Act was construed as qualifying the goods covered by a declaration under section 8(4) of the Central Sales Tax Act, not the sale itself. On that reading, goods purchased on such declarations and later sold within Mysore attracted tax liability, even though the dealer's total turnover remained below the section 5(5) exemption threshold. The interpretation treated the statutory reference to the declaration as importing the circumstances in which it is required under the Central Sales Tax Act, and the court regarded this as a fair reading of the language rather than an undue strain on it.

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Issues: Whether section 5(2) of the Mysore Sales Tax Act applied to a dealer registered under the Central Sales Tax Act who had purchased goods on declarations under section 8(4) of that Act, so as to make the dealer liable to tax on subsequent intra-State sales even though the total turnover was below the exemption threshold under section 5(5).

Analysis: The provision was construed as qualifying the goods and not the sale. A declaration under section 8(4) is made in connection with inter-State purchase of goods, and the reference in section 5(2) to goods in respect of which such a declaration has been furnished was held to import the circumstances under which the declaration is required to be made under the Central Sales Tax Act. On that reading, the liability to tax attached to sales within Mysore of such goods, irrespective of the quantum of turnover. The construction was held to be a fair reading of the statutory language and not an impermissible strain on it.

Conclusion: Section 5(2) was held applicable, and the assessee was liable to tax on the relevant sales notwithstanding that her turnover was below Rs. 7,500.

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