Declared goods taxation requires a clearly fixed single point of levy; cotton yarn assessment failed without a valid notification.

Cotton yarn, being a declared good under Section 14 of the Central Sales Tax Act, 1956, could be taxed by the State only in compliance with Section 15, which restricts levy to a single stage. The State law had to fix the single point of taxation expressly or by necessary implication, or authorise a valid notification to do so. In the absence of an Official Gazette notification fixing the relevant single point of levy, the multi-point assessment did not satisfy the statutory restriction and could not stand. The levy was therefore invalid and the references were answered in favour of the assessee.

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Issues: Whether sales tax could be validly imposed on cotton yarn under the Bengal Finance (Sales Tax) Act, 1941 as extended to Delhi when no single stage of levy had been fixed, and whether such levy complied with the restrictions under Sections 14 and 15 of the Central Sales Tax Act, 1956.

Analysis: Cotton yarn is a declared good under Section 14 of the Central Sales Tax Act, 1956. Section 15 restricts the State taxing power in respect of declared goods and requires that tax not be levied at more than one stage. For compliance with that mandate, the State law must specify, expressly or by necessary implication, the single point of levy, or authorise a delegate to do so. In the absence of a notification in the Official Gazette fixing the single point for the relevant turnover, the statutory condition against multi-point taxation is not satisfied and the assessment cannot stand.

Conclusion: The levy on cotton yarn was invalid, and the questions referred were answered in favour of the assessee and against the revenue.

Final Conclusion: The references were answered by holding that taxation of cotton yarn without a notified single point of levy did not satisfy the restrictions applicable to declared goods.

Ratio Decidendi: For declared goods, a sales tax levy is valid only if the State law or a valid notification clearly fixes a single ascertainable point of taxation, since compliance with Section 15 of the Central Sales Tax Act, 1956 is essential to the validity of the impost.

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