Single-point sales tax on declared goods cannot be denied merely for missing prescribed form when second purchase is proved.

Declared goods purchased at a point after the first taxable purchase were not liable to tax in the buyer's hands under the single-point scheme of the Tamil Nadu General Sales Tax Act. Where the dealer produced purchase bills, vouchers, and seller particulars showing that tax had already been paid, the turnover was treated as second purchases and fell outside section 4 tax liability. Failure to produce the form prescribed by rule 26(13) did not defeat the substantive exemption, because that rule was procedural and the dealer had otherwise discharged the burden of proving non-liability under section 10. The substantive tax position prevailed over the missing form.

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Issues: (i) Whether second purchases of declared goods were liable to tax under section 4 of the Tamil Nadu General Sales Tax Act when the assessee produced purchase bills showing that the goods had already suffered tax; (ii) Whether failure to comply with rule 26(13) of the Tamil Nadu General Sales Tax Rules defeated the assessee's claim to exemption and whether the burden under section 10 stood discharged by the materials produced.

Issue (i): Whether second purchases of declared goods were liable to tax under section 4 of the Tamil Nadu General Sales Tax Act when the assessee produced purchase bills showing that the goods had already suffered tax.

Analysis: Section 4 levies tax on declared goods only at the single point specified in the Second Schedule, and oil-seeds were taxable at the point of first purchase. If the assessee's purchases were subsequent purchases from dealers already in existence and registered, the purchases were not at the first taxable point. The assessee produced the purchase bills and vouchers from the sellers, and those documents certified that tax had been paid. On that footing, the turnover could not be treated as taxable in the assessee's hands as a first purchaser.

Conclusion: The turnover represented second purchases and was not taxable in the assessee's hands.

Issue (ii): Whether failure to comply with rule 26(13) of the Tamil Nadu General Sales Tax Rules defeated the assessee's claim to exemption and whether the burden under section 10 stood discharged by the materials produced.

Analysis: Rule 26(13) required production of a bill in form 21, but the rule was not mandatory in the sense of extinguishing the substantive exemption under section 4. The burden under section 10 lay on the dealer to establish non-liability, but the mode of proof was not rigidly prescribed. By producing the relevant bills, vouchers, and particulars of the sellers, the assessee discharged the burden placed upon it. Non-production of the form did not, by itself, create tax liability where the substantive position of second purchase was otherwise established.

Conclusion: The assessee had discharged the burden of proof, and non-compliance with rule 26(13) did not forfeit the exemption.

Final Conclusion: The revision was rightly rejected because the assessee's purchases were second purchases of declared goods and remained outside tax liability under the single-point scheme.

Ratio Decidendi: Where a dealer establishes that purchases of declared goods were subsequent to the first taxable purchase, the substantive exemption cannot be denied merely for non-compliance with a procedural rule requiring a particular form of declaration, if the dealer otherwise discharges the burden of proving non-liability.

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