Purchase tax under section 5A requires cumulative statutory conditions; seller non-registration alone does not prove tax immunity.

Purchase tax under section 5A applies only when the statutory conditions are cumulatively met, including despatch of goods outside the State otherwise than as a direct result of inter-State trade or commerce, and the Tribunal could not rely on the explanation to the definition of sale to override those requirements. Liability also cannot be fastened merely because the seller is unregistered; it must first be found that the purchase is one on which no tax is payable under section 5, since an unregistered dealer may still be liable to tax. The Tribunal's approach was therefore held legally unsustainable and the matter was remitted for fresh consideration on the sellers' liability under section 5.

---

---

Issues: (i) Whether purchases of goods from unregistered dealers, followed by export and despatch outside the State, attracted purchase tax under section 5A notwithstanding the Tribunal's reliance on the explanation to the definition of sale; (ii) Whether liability under section 5A could be fastened without first finding that the transaction was one in which no tax was payable under section 5, merely because the sellers were unregistered dealers.

Issue (i): Whether purchases of goods from unregistered dealers, followed by export and despatch outside the State, attracted purchase tax under section 5A notwithstanding the Tribunal's reliance on the explanation to the definition of sale.

Analysis: Section 5A was held to operate when the statutory conditions are cumulatively satisfied. The earlier view that export sales could be treated as local sales by reason of the explanation to the definition of sale was not accepted, because such a construction could not exclude the separate conditions in section 5A(1), particularly despatch of purchased goods to a place outside the State otherwise than as a direct result of inter-State trade or commerce. The Tribunal's reliance on the contrary view was therefore legally unsustainable.

Conclusion: The Tribunal was wrong in holding that the purchases escaped section 5A on the basis of the explanation to the definition of sale.

Issue (ii): Whether liability under section 5A could be fastened without first finding that the transaction was one in which no tax was payable under section 5, merely because the sellers were unregistered dealers.

Analysis: The governing condition under section 5A is not merely that the purchase is from an unregistered dealer or that one of the clauses in section 5A(1) is satisfied. A further condition precedent is that the purchase must be in circumstances in which no tax is payable under section 5. Non-registration does not necessarily mean non-liability to tax, because even an unregistered dealer may be liable under section 5 if the turnover so attracts tax. The Tribunal had not examined this essential question.

Conclusion: Liability under section 5A could not be affirmed without determining whether the sellers were liable to tax under section 5.

Final Conclusion: The revisions succeeded, the Tribunal's approach was set aside, and the matters were sent back for fresh consideration confined to the sellers' liability under section 5 despite their non-registration.

Ratio Decidendi: Purchase tax under section 5A can be levied only when the purchase falls within the specified clauses and, in addition, the transaction is one in which no tax is payable under section 5; non-registration of the seller is not conclusive of non-liability.

---