Independent charging provision under sales tax law upheld; legal fiction and heading could not narrow the levy.

Section 6B of the Karnataka Sales Tax Act operated as an independent charging provision for turnover not liable under sections 5, 5A, 5B, 5C or 6, so turnover covered by the second and third provisos to section 5(3)(a) was still taxable under section 6B. The provisos to section 5(3)(a) were confined to that provision and the legal fiction created there could not be extended to defeat a separate levy. The caption describing section 6B as resale tax, and the budget speech, could not limit the plain text of an unambiguous charging provision. The tenth proviso to section 6B was also held inapplicable, leaving the assessees liable.

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Issues: (i) Whether turnover falling within the second and third provisos to section 5(3)(a) of the Karnataka Sales Tax Act, 1957 was nevertheless liable to tax under section 6B of that Act. (ii) Whether the caption of section 6B as a levy of resale tax and the budget speech could restrict the plain scope of the charging provision. (iii) Whether the tenth proviso to section 6B exempted the assessees from liability under that provision.

Issue (i): Whether turnover falling within the second and third provisos to section 5(3)(a) of the Karnataka Sales Tax Act, 1957 was nevertheless liable to tax under section 6B of that Act.

Analysis: Section 6B was treated as an independent charging provision imposing tax on the portion of total turnover not liable under sections 5, 5A, 5B, 5C or 6. The second and third provisos to section 5(3)(a) were held to operate only within section 5(3)(a) and not to be carried forward into section 6B. The earlier fiction that certain transactions were not sales for section 5(3)(a) did not eliminate the turnover from the scope of section 6B, because that section turned on the absence of liability under the specified charging provisions.

Conclusion: The turnover remained liable under section 6B and the assessees' contention was rejected.

Issue (ii): Whether the caption of section 6B as a levy of resale tax and the budget speech could restrict the plain scope of the charging provision.

Analysis: The heading and budget speech were held to be only aids to interpretation and could not control an unambiguous charging provision. The language of section 6B did not confine the levy to second or subsequent sales. The substantive scope of the provision was determined by its text, not by nomenclature or legislative speech.

Conclusion: The caption and budget speech did not limit section 6B to second or subsequent sales, and the assessees' argument failed.

Issue (iii): Whether the tenth proviso to section 6B exempted the assessees from liability under that provision.

Analysis: The tenth proviso was found inapplicable because it proceeded on a payment or liability at the point of sale, whereas the assessees' transactions, by reason of the provisos to section 5(3)(a), did not take the cases out of section 6B. Since the fiction under section 5(3)(a) could not be extended to section 6B, the proviso could not be invoked to defeat the levy.

Conclusion: The tenth proviso did not apply and gave no relief to the assessees.

Final Conclusion: The impugned writ relief was set aside, the challenge to the revenue orders failed, and the reassessment and consequential orders sustaining liability under section 6B were upheld for all connected matters.

Ratio Decidendi: A legal fiction created for a limited charging provision cannot be telescoped into a separate independent charging section, and a statutory heading or budget speech cannot override the plain text of an unambiguous tax levy.

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