TaxTMI 
TaxTMI 
1987 (3) TMI 500
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.... soap, sugar, detergent powder, turmeric, fertiliser, etc., for which the petitioners are liable to pay sales tax. The petitioners also carry on business of purchase and sale of various commodities like kerosene oil, high speed diesel oil, mobil oil and vegetable oil which are not liable to be included in the "taxable turnover" of the petitioners for the purpose of computation of sales tax liability. The dispute, in the case, is about the includibility of the transactions relating to kerosene oil, high speed diesel oil, mobil oil and vegetable oil in the turnover of the petitioners for the purpose of levy of turnover tax. It has been contended on behalf of the petitioners that since the turnovers in respect of these commodities are not to b....
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....d which remains after deducting therefrom various categories of turnover enumerated in that sub-section. Section 6(1) is important for the purpose of this case and it lays down "no tax shall be payable under this Act on the sale of goods specified in the first column of Schedule I, subject to the conditions and exceptions, if any, set out in the corresponding entry in the second column thereof. " The scheme of the Bengal Finance (Sales Tax) Act is to levy tax on "all sales effected" of all commodities except which have been specified as tax-free in the first column of Schedule I to the Act subject to the conditions and exceptions set out therein. Entry 17 of the Schedule deals with inferior grade of kerosene oil and entry 50 refers to....
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....oss turnover of a dealer during any period which remains after deducting therefrom his turnover during that period on- (a) sales of goods referred to in section 14 of the Central Sales Tax Act, 1956 (74 of 1956); (b) sales of electrical energy and newspapers; (c) sales of 'motor spirit' as defined in clause (b) of section 2 of the West Bengal Motor Spirit Sales Tax Act, 1974 (West Ben. Act XI of 1974); (d) sales of goods declared tax-free under section 6; (e) sales of goods which are generally exempt from tax under subclause (vi) of clause (a) of sub-section (2) of section 5; (f) sales referred to in sub-clause (v) of clause (a) of sub-section (2) of section 5 of goods, other than those specified in clauses (a), (b)....
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....f the gross turnover under this Act and the gross turnover under the West Bengal Sales Tax Act, 1954 ......... exceeds Rs. 50,00,000". The tax, however, has not been levied on the aggregate gross turnover. But tax is on "such part of his turnover as specified in sub-section (2)". Therefore, for imposition of turnover tax, the first step is to find out the dealers who are liable to pay this tax. For this purpose, aggregation of gross turnovers is necessary. The goods specified in the first column of Schedule I of the Act which have been declared to be tax-free are not to be kept out for the purpose of calculation of gross turnover. Section 6 merely says that "no tax shall be payable under this Act" on such goods. Section 6B does not seek ....
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....ss turnover "is the sale of goods declared tax-free under section 6". In other words, sales of tax-free goods which are includible in gross turnover has to be deducted for the purpose of calculation of taxable turnover under section 5(2) of the Act. Therefore, there is nothing in the Act to indicate that for the purpose of computation of gross turnover, the sales of tax-free goods should not be included. The position is made abundantly clear by section 6B(2) by which it is provided that "turnover tax shall be levied on that part of the gross turnover of a dealer which remains after deducting therefrom his turnover" on, inter alia, "sales of goods declared tax-free under section 6". For the reasons aforesaid, I am unable to uphold the arg....