2014 (2) TMI 102

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....1. Whether the petitioners are liable to purchase tax under Section 7A on the purchases effected from unregistered dealers who were liable to pay tax under Section 3 by virtue of such sellers having turnover in excess of the exemption limit?    2. Is the order of the Sales Tax Appellate Tribunal restoring the levy of penalty under Section 16(2) legal without there being either finding of wilfulness or non-disclosure of turnover especially when no ground had been raised by the Revenue to seek the restoration of the penalty?" 2. The assessee has also filed writ petition challenging the levy of penalty as confirmed by the Sales Tax Appellate Tribunal. 3. The assessee herein purchased Bagasse from unregistered dealers for use....

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....ase the sellers ought to have got registered themselves and paid tax thereon. A mere failure on the part of the sellers in registering themselves would not be justified in invoking Section 7A of the Tamil Nadu General Sales Tax Act, 1959. Thus, the First Appellate Authority allowed the assessee's appeal, thereby setting aside the order of assessment as well as the penalty levied. 6. Aggrieved by this, the Revenue went of further appeal before the Sales Tax Appellate Tribunal contending that in the light of the decision of the Supreme Court in [State of Tamil Nadu vs Kandaswami] reported in (1975) 36 STC 191 [SC], the goods not having suffered tax earlier by reason of circumstances stated under Section 7A of the Tamil Nadu General Sales T....

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.... business purchases from a registered dealer or from any other person, any goods, (the sale or purchase of which is liable to tax under this Act) and in the circumstances, if no tax is payable under Sections 3 or 4 and consumes or uses such goods in or for the manufacture of other goods for sale or otherwise, Section 7A would stand attracted. 10. Considering the fact that Section 7A of the Tamil Nadu General Sales Tax Act, 1959 is a charging section aimed at plugging the loop hole in cases where goods had not suffered tax and by reason of circumstances stated in the Section are not available for further dealing under the provisions of the Act, the contention of the assessee that the failure on the part of the seller to get himself regist....