Sales tax exemption and countervailing duty depend on levy under the specified statute and proper notification.

Sales tax exemption under section 8 read with item 3 of Schedule III to the Tamil Nadu General Sales Tax Act was confined to goods on which duty had been levied or was leviable under the Madras Prohibition Act, 1937. Payment of excise duty in West Bengal under the Medicinal and Toilet Preparations (Excise Duties) Act, 1955 did not satisfy that condition, and section 8 of the General Clauses Act could not extend the exemption. The article also states that countervailing duty under section 18-A of the Madras Prohibition Act depended on an actual notification by the State Government; in the absence of such notification, no lawful levy existed to support exemption on that footing.

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Issues: (i) Whether payment of excise duty in West Bengal under the Medicinal and Toilet Preparations (Excise Duties) Act, 1955, entitled the assessee to exemption under section 8 read with item 3 of Schedule III to the Tamil Nadu General Sales Tax Act, 1959. (ii) Whether the absence of a notification under section 18-A of the Madras Prohibition Act, 1937, defeated the claim to exemption on the footing of countervailing duty.

Issue (i): Whether payment of excise duty in West Bengal under the Medicinal and Toilet Preparations (Excise Duties) Act, 1955, entitled the assessee to exemption under section 8 read with item 3 of Schedule III to the Tamil Nadu General Sales Tax Act, 1959.

Analysis: The exemption was confined to goods on which duty was levied or leviable under the Madras Prohibition Act, 1937, and the sales tax exemption extended only where the relevant duty had been paid in the State under that Act. Payment of duty under the Medicinal and Toilet Preparations (Excise Duties) Act, 1955, in another State did not amount to payment of duty under the Madras Prohibition Act, 1937, and section 8 of the General Clauses Act, 1897, did not assist the assessee in this setting.

Conclusion: The assessee was not entitled to exemption on this ground.

Issue (ii): Whether the absence of a notification under section 18-A of the Madras Prohibition Act, 1937, defeated the claim to exemption on the footing of countervailing duty.

Analysis: Section 18-A authorised levy of countervailing duty only to the extent specified by notification of the State Government. In the absence of any notification levying such duty on the goods in question, there was no legal levy capable of supporting the exemption claim. A mere possibility of levy was insufficient without the requisite notification.

Conclusion: The assessee was not entitled to exemption on this ground either.

Final Conclusion: The exemption claim failed in full, and the tribunal's view was unsustainable in law.

Ratio Decidendi: A sales tax exemption confined to duty paid or leviable under a specified statute cannot be extended to duty paid under a different enactment in another State, and a countervailing duty exemption depends on an actual statutory levy supported by the required notification.

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