Sales tax on vegetable ghee purchases from unregistered dealers could not stand after the controlling appellate ruling.

A sales tax assessment under the Punjab General Sales Tax Act, 1948, treated vegetable ghee sold by unregistered dealers as taxable on the basis of a single-judge view later reversed in Letters Patent appeal. Because the present facts were identical to the appellate decision, the controlling ratio was that no sales tax was payable on such purchases, and orders founded on the overruled view could not be sustained. The assessment and revisional orders were accordingly quashed, and the dealer was held not liable to pay sales tax on the ghee purchased from unregistered dealers.

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Issues: Whether sales tax was payable on vegetable ghee purchased by a registered dealer from unregistered dealers, and whether the revisional and assessment orders based on the overruled single-judge decision could be sustained.

Analysis: The assessment was made under section 21 of the Punjab General Sales Tax Act, 1948, on the footing that the sale of vegetable ghee was wrongly exempted under the proviso to section 5(1-A) of the Act. The earlier single-judge view on which the authorities had relied had already been reversed in Letters Patent appeal. The facts of the present case were treated as identical to those in the appellate decision, and the same legal ratio governed the controversy. In these circumstances, the basis adopted by the authorities for fastening tax liability could not stand.

Conclusion: The petitioner was not liable to pay sales tax on the ghee purchased from unregistered dealers, and the assessment and revisional orders were liable to be quashed in favour of the assessee.

Final Conclusion: The writ petition succeeded and the impugned orders were set aside, leaving no order as to costs.

Ratio Decidendi: Where the controlling appellate decision on identical facts holds that no sales tax is payable, assessment or revisional orders founded on the contrary overruled view cannot be sustained.

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