1991 (3) TMI 354

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....ssessee was purchasing raw bones and after converting and crushing the same was selling them to the foreign buyers in the converted form. Being of the opinion, that purchase of the raw bones from the villagers, who were non-registered dealers, and the sale of the bone-meal to the foreign buyers after "consuming" the bones by the method of crushing and converting, attracted the levy of purchase tax under section 7-A(1)(a) of the Act, the assessee was subjected to the levy of tax in respect of the purchases of the bones made from the unregistered dealers. Ultimately the total taxable turnover of the assessee was determined by the assessing officer at Rs. 18,09,478. The assessee preferred an appeal before the Appellate Assistant Commissioner. ....

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....n 7-A was worked out at Rs. 3,63,888. The total taxable turnover of the assessee for the year 1975-76 was, accordingly, redetermined as Rs. 16,75,182 and found as assessable at 4 per cent. The assessee went up in further appeal before the Sales Tax Appellate Tribunal, while the Revenue also filed a petition for enhancement. The Tribunal, vide order dated 8th of December, 1980, partly allowed the appeal filed by the assessee while dismissing the enhancement petition filed by the Revenue. 3.. The Tribunal considered the disputed addition to the turnover under section 7-A of the Act and relying upon the decision of this Court reported in Thangiah Nadar v. State of Tamil Nadu [1980] 46 STC 67, wherein it had been held that where the goods we....

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....h as the sale has been made by the assessee to a place "outside the State" (a foreign buyer) and was not covered by the exception contained in clause (c) of section 7-A(1), relating to the sale or purchase in the course of inter-State trade or commerce. Learned Government Advocate submitted that the judgment rendered by this Court in Ponnu Saw Mills v. State of Tamil Nadu [1980] 45 STC 291 which was rendered on 22nd November, 1979, squarely governs the case and that the Tribunal fell in error in holding that section 7-A of the Act was not attracted. 4.. Section 7-A(1)(b) and section 7-A(1)(c) deal with two distinct situations. Sub-clause (b) of section 7-A(1) would be attracted where the assessee disposes of the goods, covered by the sec....