Independent purchase tax under section 7-A applies despite single-point levy when untaxed goods are consumed in manufacture.

Section 7-A of the Tamil Nadu General Sales Tax Act was treated as an independent charging provision, so purchase tax could apply even where the goods were ordinarily subject to single-point levy under section 3(2). Purchases of bullion and old ornaments from persons not liable to tax, followed by consumption in manufacture of jewellery, satisfied the statutory conditions for levy because the goods had not suffered tax from a liable seller and were dealt with in the manner specified in the section. The purchase turnover was therefore correctly brought to tax, while the correct quantum of turnover was left for verification.

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Issues: Whether purchase tax under section 7-A of the Tamil Nadu General Sales Tax Act, 1959 was leviable on bullion and old ornaments purchased from persons not liable to tax and consumed in the manufacture of other jewellery, notwithstanding the single point levy under section 3(2).

Analysis: Section 7-A was treated as an independent charging provision. The earlier Supreme Court interpretation was applied to hold that section 7-A brings to tax goods which are generally taxable under the Act but have not suffered tax because the seller was not liable under sections 3, 4 or 5, and which are thereafter consumed in manufacture or otherwise dealt with in the manner specified in the section. The fact that some goods in the First Schedule are normally subject to single point levy did not exclude the operation of section 7-A. The assessee's vendors were not dealers liable to tax, and the purchased goods were admittedly consumed in manufacture, satisfying the statutory conditions for levy.

Conclusion: The purchase turnover was correctly brought to tax under section 7-A, and the plea based on section 3(2) failed.

Final Conclusion: The tax demand under section 7-A was upheld, though the matter of the correct quantum of turnover was left for verification by the Board.

Ratio Decidendi: Section 7-A is a charging provision that operates independently of the single point levy under section 3(2), and purchase tax is attracted where taxable goods are purchased from persons not liable to tax and are thereafter consumed in manufacture or otherwise dealt with as specified in the section.

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