TaxTMI 
TaxTMI 
1981 (9) TMI 262
X X X X Extracts X X X X
X X X X Extracts X X X X
....ations issued under section 4 of the Act, in spite of the notifications issued under section 3-A from time to time making ice-cream taxable under those notifications. STR No. 848 of 1980 raises the question as to whether lassi is entitled to exemption on the same score. Before we refer to the conflicting decisions of this Court on the two items involved in the revisions, we may refer to the relevant notifications under sections 4 and 3-A. We propose first to refer to the notifications under section 4 exempting milk products from tax. The first notification on the subject is Notification No. ST-911/X dated 31st March, 1956. Item No. 10 of this notification is in the following terms: "10. Milk and milk products such as chhena, dahi, kho....
X X X X Extracts X X X X
X X X X Extracts X X X X
....roducts sold in sealed containers, (2) sweetmeats, (3) ghee, and (4) butter, cream and cheese." There is another notification regarding milk products of 30th July, 1981, being Notification No. ST-II-62/X-6(11)-1980 dated 30th July, 1981, which we will refer to after referring to the notification issued under section 3-A which made ice-cream and lassi taxable under the notification issued under that section. It would be convenient first to refer to Notification No. ST-II-6628/X dated 1st December, 1973, under section 3-A of the Act. Item No. 17 of this notification, inter alia, made the turnover of ice-cream and lassi liable to tax at all points of sale. Item No. 17 of the notification so far as it is relevant may be extracted: ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... section 4, as referred to earlier, the State Government issued the notifications dated 1st December, 1973, 4th November, 1974, and 30th May, 1975, under section 3-A of the Act specifically referring to ice-cream and lassi and making them taxable under those notifications. Thus, it will be seen, while on the one hand there were existing notifications under section 4 of the Act exempting milk products, one such notification being of the 1st December, 1973. On this very date, there was a notification under section 3-A imposing tax on ice-cream and lassi under section 3-A. The State Government was merrily issuing notifications under section 3-A making ice-cream and lassi taxable under that provision. It was an oddity, and it appears that State....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ook the view that the notification of 1st December, 1973, superseded all earlier notifications and, as such, ice-cream was taxable under the notification under section 3-A. On the contrary, Prem Prakash, J., in the case of Commissioner of Sales Tax v. Dayal Singh Kulfiwala [1982] 49 STC 295; 1980 UPTC 360 held that kulfi and lassi being milk products were exempt from tax, notwithstanding the notification issued under section 3-A making them taxable under that provision. We feel that in case the State Government had been more alert in realising the repercussions of issuing notifications under section 3-A, while milk products including ice-cream and lassi were exempt under the notification issued under section 4, the divergence of opinions wh....
X X X X Extracts X X X X
X X X X Extracts X X X X
....gross turnover of the dealer because they are prima facie liable to tax and the only thing which the dealer is entitled to in respect thereof is the deduction from the gross turnover in order to arrive at the net turnover on which the tax can be imposed. In the latter case, the sales or purchases are exempted from taxation altogether. The legislature cannot enact a law imposing or authorising the imposition of a tax thereupon and they are not liable to any such imposition of tax. If they are thus not liable to tax, no tax can be levied or imposed on them and they do not come within the purview of the Act at all. The very fact of their nonliability to tax is sufficient to exclude them from the calculation of the gross turnover as well as the....
X X X X Extracts X X X X
X X X X Extracts X X X X
....book version of the assessee for the assessment year 1973-74 but treating ice-cream as cooked food levied tax at 3½ per cent. The appellate authority took the same view but the revising authority being of the opinion that ice-cream is a milk product, and its turnover was exempt from sales tax declared the assessee as non-taxable. I agree with the learned revising authority that ice-cream is a milk product and it is to be treated exempt from sales tax under Notification No. ST-911/X dated 31st March, 1956 (see Commissioner, Sales Tax, U.P. v. Kwality Restaurant [1980] 45 STC 486; 1979 UPTC 1298). However, with effect from 1st December, 1973, because of Notification No. ST-II-6628/X-1012-1972 dated 1st December, 1973, which was issu....