Compulsory levy rice transfers were taxable sales, and dealer liability to sales tax survived non-collection from the purchaser.

After the Forty-sixth Constitutional Amendment and the amendment to the Haryana General Sales Tax Act, compulsory transfers of rice under the levy procurement order were treated as taxable sales. The dealer's liability to sales tax was not avoided because the transaction was made under procurement directions or because tax had not been collected from the purchaser. The procurement price was treated as exclusive of tax, and relief directing the State to bear the tax was declined, while issues such as penalty, interest, and bardana were left to the statutory remedies.

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Issues: Whether the supply and delivery of rice under the Haryana Rice Procurement (Levy) Order, 1985 constituted taxable sales under the Haryana General Sales Tax Act, 1973 and whether the dealer could avoid liability to sales tax or seek directions against the State for payment of the tax.

Analysis: After the Forty-sixth Constitutional Amendment and the corresponding amendment to the Haryana General Sales Tax Act, 1973 by Act No. 11 of 1984, transfers of property in goods otherwise than in pursuance of a contract were brought within the tax net. The levy rice transactions, though made under procurement directions, were therefore held to be sales liable to tax. The procurement price in the Levy Order was treated as exclusive of tax, and the dealer remained statutorily liable under the Act irrespective of whether tax had been collected from the purchaser. The Court also declined to direct the Government to pay the tax in these proceedings and left questions relating to penalty, interest, and bardana to the statutory appellate and revisional remedies.

Conclusion: The levy rice transactions were taxable sales and the dealer was liable to pay sales tax; the request for relief against recovery and for a direction to the Government to bear the tax failed.

Ratio Decidendi: After the constitutional and statutory amendments, a compulsory transfer of goods under a levy order is a taxable sale, and the dealer's liability to sales tax is not avoided by the absence of collection from the purchaser or by the purchaser's identity as the Government.

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