2007 (7) TMI 604 - HC - VAT and Sales Tax

Dealers must pay sales tax despite exemption; court emphasizes precedent and judicial discipline

The court held that dealers purchasing goods without sales tax charged are liable to pay tax under section 5A despite exemption notifications by the State ... Whether the dealer who purchases P.V.C. pipes in circumstances in which no sales tax was charged under section 5, is liable to pay tax on the said purchase price under section 5A of the Act, because the sale of PVC pipes is exempt from payment of sales tax by virtue of a notification issued by the State Government in exercise of its power under section 10 of the Act? Issues:Whether a dealer purchasing P.V.C. pipes without sales tax charged is liable to pay tax under section 5A due to exemption notification issued by the State GovernmentRs. Whether the burden of tax should be on dealers purchasing goods from SSI units exempted from sales taxRs.Analysis:The judgment discussed the liability of dealers purchasing goods without sales tax charged under section 5A due to exemption notifications by the State Government. The legal issues revolved around the burden of tax on dealers purchasing from SSI units exempted from sales tax. The court referred to previous decisions highlighting the applicability of section 5A in such scenarios. The judgment emphasized the importance of following precedents to maintain judicial decorum and continuity of law. It reiterated the binding nature of decisions by a High Court's Division Bench on subsequent cases. The court stressed the need to adhere to precedents unless reversed or overruled by a higher court, affirmed or reversed on different grounds, inconsistent with earlier decisions of the same rank, sub silentio, or rendered per incurium.The court acknowledged the arguments presented by the learned Senior Counsel but aligned with previous decisions, concluding that the issues raised should be answered against the assesses and in favor of the Revenue. It dismissed the stay petitions in light of the established legal principles and precedents. The judgment underscored the significance of judicial discipline and adherence to established legal principles to avoid wasting public time and ensure efficient handling of pending cases. The decision emphasized the necessity of upholding precedents unless exceptional circumstances warrant deviation, ensuring consistency and predictability in legal outcomes.