Turnover computation excludes foodgrain sales after purchase-tax notification under the U.P. Sales Tax Act.

Foodgrains notified under section 3-D(1) as liable to purchase tax from 1 October 1964 ceased to be taxable sales under the U.P. Sales Tax Act's charging provision. Because section 3-D(4) barred levy of sales tax under any other section on those goods, post-notification sales could not be treated as sales liable to tax for computing gross turnover under section 3. The turnover threshold had to be tested only on sales remaining within the charging net, so sales made after 1 October 1964 were excluded from the turnover calculation.

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Issues: Whether the sales of foodgrains made during the period from 1st October, 1964, to 31st March, 1965, could be taken into account for determining the turnover of foodgrains under section 3 of the U.P. Sales Tax Act.

Analysis: The charging provision required the dealer's liability to be tested with reference to the gross turnover for the assessment year, and the rules showed that gross turnover meant turnover of sales liable to tax, subject only to specified deductions. Once foodgrains were notified under section 3-D(1) as liable to purchase tax from 1st October, 1964, section 3-D(4) operated to bar levy of sales tax under any other section in respect of those goods. Sales made after that notification therefore ceased to be taxable sales under the charging section and could not be included in the gross turnover for deciding whether the threshold limit was crossed.

Conclusion: The post-1st October, 1964 sales of foodgrains could not be taken into account for determining turnover under section 3, and the question was answered in the negative in favour of the assessee.

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