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Issues: Whether additional sales tax could be levied and collected in assessments made under the Central Sales Tax Act on inter-State turnover, and whether the circular/clarification treating such additional sales tax as part of the CST rate was valid.
Analysis: The charging provision under the Tamil Nadu Additional Sales Tax Act was held to operate only within the framework of the State sales tax levy and not to extend, by implication, to CST assessments. The Court distinguished cases dealing with rate linkage under the CST Act, noting that the additional sales tax statute was a specific enactment and that the CST Act required an enabling provision before any ancillary levy could be fastened on the dealer. Section 9(2) of the CST Act was found insufficient by itself because it only provided the mechanism for assessment and collection and did not create a substantive liability to levy additional sales tax in CST assessments. The reliance placed on earlier authorities was held not to justify extending the additional sales tax burden to inter-State transactions, and the clarification circular, founded on that premise, could not stand.
Conclusion: The levy of additional sales tax in CST assessments was impermissible, and the impugned assessments and clarification were quashed.
Ratio Decidendi: A levy cannot be read into CST assessments unless the CST Act or the relevant taxing statute contains a clear substantive charging provision authorising it; a procedural collection provision cannot by itself create such liability.
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