TaxTMI 
TaxTMI 
1994 (10) TMI 284
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....m Parameswari & Co., Pudukottai for Rs. 41,056.28. It was later found that the above persons were decorticators acting as mediators between agriculturists who brought groundnut to their mills for decortication and the purchasers. Inasmuch as Parameswari & Co., were not dealers the next buy- ers-the appellants were considered as first sellers(?) in the State and were assessed to tax at 3 per cent. The Joint Commissioner of Commercial Taxes II, examined the above case with reference to the available records. It is seen from the records that collection of tax by the decorticators who is not a dealer is contrary to section 22(1) of the Tamil Nadu General Sales Tax Act. Hence the Joint Commissioner held that provisions of section 22(1) are attra....
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.... the assessment made in the case of Parameswari & Co. was not disturbed and the assessment has become final. While so, in the suo motu proceeding initiated by the Joint Commissioner it is not possible to hold that the said Parameswari & Co. is not a registered dealer and, therefore, the tax collected by it is illegal and the tax paid by it would be treated as penalty payable to the State. The Joint Commissioner was not correct in holding that the purchase by Lucky Mills is the first purchase and therefore Parameswari & Co., is liable to pay tax. Penalty under section 22(1) and (2) of the Act was not levied by the authorities below, and the Joint Commissioner who is not the assessing authority cannot levy penalty on Parameswari & Co., who is....
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.... taxable turnover of Rs. 28,49,581 and Rs. 16,39,230 respectively. According to the Revenue, Lucky Mills purchased groundnut from Parameswari & Co. Parameswari & Co. is not a registered dealer and, therefore, the tax collected by Parameswari & Co. should be treated as penalty payable by it and since the sale in favour of Lucky Mills happened to be the first sale, the tax is payable by Lucky Mills. On the other hand, the appellant submitted that Parameswari & Co. sold groundnut to Lucky Mills and the tax collected on the same, paid to the Revenue. Therefore the sale between Parameswari & Co. and Lucky Mills is the second sale. The tax on sale of groundnut is single point tax. According to the assessee Parameswari & Co. is not a decorticator ....
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....held as under: ".......If the sale effected by the assessee is not the first sale, then under the provisions of the Act that sale cannot be brought within the net of taxation and it is for the revenue to search the first seller and levy tax on the first sale. It is not for the assessee, who is the subsequent seller, to show that the first sale has been taxed. Once it is found that the assessee's sale is a subsequent sale and there has been a first sale in respect of the same goods earlier in the State, then it is for the authorities to proceed to levy that transaction of first sale, and the onus cannot be thrown on the assessee to show that the first sale has suffered tax. The onus on the subsequent seller is only to point out that there....