First-point sales tax applies to the contract transferring collection rights, not the transferee's later consumer sales.

Where sales tax is levied at the first point in a series of sales under section 5 read with rule 15, a contract by which the Panchayat Samiti and the Forest Department transferred to the assessee the right to collect bones and chaal for consideration was treated as the first taxable sale. The later sales by the assessee to consumers were not the relevant taxable point. The availability of the goods in the area was held immaterial, and the charging provision had to be construed strictly. The taxable point was therefore the transaction between the departments and the assessee.

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Issues: Whether, under section 5 and rule 15, sales tax was payable at the first point when the Panchayat Samiti and the Forest Department contracted with the assessee to allow collection of bones and chaal, or on the assessee's subsequent sales to consumers.

Analysis: Section 5 read with rule 15 prescribed single-point taxation at the first point in the series of sales by successive dealers. The contract by which the departments surrendered their right to the assessee for consideration amounted, in substance, to the first sale in the chain. The availability of the goods in the area was held to be irrelevant, and the later sales by the assessee were not treated as the taxable first point. The taxing provision was required to be construed strictly, and the first taxable point was the contract between the departments and the assessee.

Conclusion: Tax was leviable only at the first point, namely, on the transaction between the departments and the assessee, and not on the assessee's subsequent turnover. The issue was decided in favour of the assessee.

Final Conclusion: The revision succeeded because the Tribunal's view on the taxable point was incorrect, and the assessment on the assessee's turnover could not stand.

Ratio Decidendi: Where the sales tax law provides for levy at the first point in a series of sales, a contract transferring the right to collect goods for consideration constitutes the taxable first sale, and subsequent sales by the transferee do not bear the tax at that stage.

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