1963 (8) TMI 33

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....ny, that that transaction had already been subject to tax, that the amount of tax so levied had been collected and that therefore another levy cannot be made against them. The department did not accept this contention and assessed the turnover to tax. The petitioners' appeal to the Sales Tax Appellate Tribunal also failed and hence this revision petition. The way in which the petitioners sought to save themselves from the levy of tax before the department and the Tribunal was to contend that Messrs Eastern Electric Company was their selling agents, that they actually sold the goods to the Madras State Electricity Board and that the turnover relating to that sale has been subject to tax which has been paid by the petitioners through Messr....

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....ollowing manner: "With regard to the sales tax, since this has to be paid at only one point, we consider that it may not be necessary for us to charge this to you since the goods will be on consignment with you and that it would be sufficient for you to collect the sales tax from the department and pay it to the Sales Tax Authorities. On this presumption we will refrain from charging any sales tax to you." There is enough indication in this letter to show that the transaction between the petitioners and the Eastern Electric Company was not one intended to be by way of sale. The Eastern Electric Company wrote back to the petitioner as follows on 16th May, 1959: "We agree to purchase the 2,000 dozens L.T. Shackle insulators along with t....

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.... subject to a single point levy as prescribed under the First Schedule of the Madras General Sales Tax Act, 1959. Entry 41 provides that the point of levy shall be the point of first sale in the State at the rate of six per cent. If there was really one sale, and, that was the first sale, that has already been taxed and the tax amount has been collected.   Now the contention of the department is that the petitioners should be deemed to have sold the goods to the Eastern Electric Company and that company in turn actually sold the goods to the State Electricity Board. In other words, in the view of the department there are two sales, the first by the petitioners in favour of the Eastern Electric Company and the second by the company i....