2015 (4) TMI 317

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....Tribunal is correct in interpreting the expression does not sell the goods so manufactured occurring in sub-section (4) of Section 3 of the Tamil Nadu General Sales Tax Act, 1959 as including not only intra state but also export sale? ii) Whether the Appellate Tribunal is correct in invoking the principle of situs as envisaged in Explanation 3 (a) to Section 2 (n) of the Tamil Nadu General Sales Tax Act, 1959 for the purpose of interpretation of the expression does not sell the goods so manufactured as contained in sub-section (4) of Section 3 of the Act so as to bring it within the ambit of the said explanation? iii) Whether the Appellate Tribunal is legally correct in distinguishing the judgment of the Hon'ble Supreme Court in the c....

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....ssment year 2000-2001 under the Tamil Nadu General Sales Tax Act, 1959. During the course of check of accounts, it was found that the assessee had purchased raw materials against Form XVII declarations and used the same in the manufacture of chemicals and made export sales in addition to domestic sales. Hence, the Assessing Officer arrived at the proportionate value of purchases made against Form XVII which were used in the manufacture of chemicals exported and assessed the same at 1% under Section 3(4) of the Tamil Nadu General Sales Tax Act, 1959. Aggrieved by the order of the Assessing Officer, the assessee filed an appeal before the Appellate Assistant Commissioner, who dismissed the appeal, thereby upheld the order of the Assessing Off....

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....ds, when the State lacks the legislative competence by virtue of the Constitutional embargo to levy any tax on export sale, the indirect creation of any tax liability on such 'export sales' on the inputs purchased cannot at all be recognised. To put it differently, if the levy of 1% tax on the value of the goods purchased by the dealer who is dealing in manufacture of goods inside the State by availing concessional rate of 3% tax by using Form-XVII, under Section 3(3) of the Act would negate the very Constitutional restriction imposed under Article 286 as a 'deemed export' as set out under Section 5(3) of the Central Sales Tax Act, the same cannot be countenanced. In this context, it will be worthwhile to refer to a Division....