Annual turnover governs sales tax liability; later exemption cannot split the assessment year for threshold purposes.

Liability under the Kerala General Sales Tax Act's charging entry was determined by the dealer's turnover for the whole assessment year. A prospective exemption notification effective from 1 August 1991 did not justify splitting the year into separate periods to decide whether the assessee crossed the taxable threshold under entry 57. The annual turnover had to be reckoned under the statutory charging scheme and rule 18, and the earlier decision cited by the assessee was distinguishable because it concerned a different statutory context. On that basis, the dealer remained liable to tax for the relevant period.

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Issues: Whether liability to sales tax under entry 57 of the First Schedule to the Kerala General Sales Tax Act, 1963 had to be determined on the basis of the assessee's turnover for the whole assessment year, notwithstanding that the exemption under S.R.O. No. 1003 of 1991 came into force only from 1 August 1991.

Analysis: The turnover definition, the charging scheme under the Act, and rule 18 required the assessee to be assessed on the basis of the turnover for the entire financial year. The fact that the exemption notification operated prospectively from 1 August 1991 did not permit splitting the year into two periods for the purpose of deciding whether the assessee crossed the threshold under entry 57. The annual turnover had to be reckoned to determine whether the assessee fell within the taxable category. The earlier decision relied upon by the assessee dealt with a different statutory context and did not assist where the relevant issue was whether the dealer came within the annual turnover limit under the charging entry.

Conclusion: The liability had to be tested with reference to the turnover of the whole year, and the assessee was liable to tax for the relevant period.

Final Conclusion: The revision failed because the Tribunal correctly applied the statutory scheme and the governing precedent on annual turnover computation.

Ratio Decidendi: Where tax liability under a charging entry depends on the assessee's annual turnover, a later-operating exemption notification does not justify fragmenting the assessment year into separate periods for determining whether the dealer crosses the taxable threshold.

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