Contextual interpretation of turnover of sales under sales tax law covers destination sales, not only pre-despatch sales.

For authorisation under section 24 of the Bombay Sales Tax Act, 1959, the expression "turnover of sales" had to be read in context where the statutory definition was qualified by the words "unless the context otherwise requires". A construction limited only to sales effected within Maharashtra would make the provision unworkable, because goods are despatched outside the State after sale at the destination. The expression therefore covered the sale price received or receivable in respect of sales made at the place outside Maharashtra where the goods were despatched. On that interpretation, the turnover requirement was satisfied and the contrary view of the authorities was erroneous.

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Issues: Whether, for the purpose of authorisation under section 24 of the Bombay Sales Tax Act, 1959, the expression "turnover of sales" in relation to goods despatched from Maharashtra to a place outside the State means sales effected within Maharashtra before despatch, or sales made at the place outside the State where the goods are despatched.

Analysis: The relevant provisions showed that authorisation could be granted where the turnover of sales of a registered dealer consisted of goods exported outside India or despatched from Maharashtra to any place in India outside the State and exceeded the prescribed limit. The general definition of "turnover of sales" in section 2(36) was subject to the qualification that the context may require otherwise. In the context of section 24, reading the definition as limited to sales made within Maharashtra would make the provision unworkable, because goods cannot be despatched outside the State after they have already been sold within it. The expression therefore had to be understood in context as referring to the sale price received or receivable in respect of sales made at the place outside the State where the goods were despatched.

Conclusion: The assessee was entitled to authorisation under section 24, and the contrary view taken by the authorities was erroneous.

Final Conclusion: The reference was answered in favour of the assessee by holding that the turnover requirement under section 24 was satisfied by sales of the despatched goods at Jaipur, and not by any prior sale within Maharashtra.

Ratio Decidendi: A statutory definition controlled by the words "unless the context otherwise requires" must be applied contextually, and must not be read in a manner that makes the substantive provision absurd or unworkable.

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