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AI Drafter - (New and Powerful) ✕ Generate professional replies, appeals, opinions to Show Cause Notices, assessment orders, audit objections, and other legal communications using TaxTMI's AI Drafter.
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Issues: Whether the declaration in Form C furnished by the assessee was valid for the purpose of obtaining the lower rate of tax under the Central Sales Tax Act, and whether the proviso to rule 8(1) of the Madhya Pradesh Sales Tax (Central) Rules, 1957, restricting one declaration to one transaction was enforceable.
Analysis: The scheme of section 8(4) of the Central Sales Tax Act requires the selling dealer to furnish a declaration in the prescribed form and manner. The form and particulars of the declaration are to be prescribed under section 13(1)(d) of the Act by the Central Government. The impugned proviso to rule 8(1), framed by the State Government under section 13(3) and section 13(4)(e), imposed a restriction that a single declaration could not cover more than one transaction except within the prescribed limit. That restriction was inconsistent with the statutory scheme as the competence to prescribe such a condition lay under section 13(1)(d), not under the State rule-making power. Once the proviso was left out, the assessee had complied with all statutory requirements, and the Tribunal's finding also supported that only one sale transaction was involved.
Conclusion: The declaration in Form C was valid, the proviso to rule 8(1) was unenforceable, and the assessee was entitled to assessment at the lower rate under section 8(1).
Ratio Decidendi: A State-made rule cannot impose a condition on the statutory declaration required under the Central Sales Tax Act where the power to prescribe that condition is vested in the Central Government under section 13(1)(d); such an inconsistent restriction is unenforceable.
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