TaxTMI 
TaxTMI 
2014 (12) TMI 1218
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....rit of certiorari to quash the order dated November 14, 2014 which is an assessment order for the assessment year 2004-2005 under the provisions of the Tamil Nadu General Sales Tax Act (TNGST). The petitioner was issued a notice dated June 23, 2006 upon perusal of the returns filed by the petitioner for the assessment year 2004-05. It is stated in the notice that the petitioners have purchased sugarcane locally and crushed them and manufactured sugar and the sale of this sugar is not liable to tax as per entry (1) of Part A of the Third Schedule. Further, it was stated that as per the annual report for the year 2004-05, they have imported raw sugar under the advance licensing scheme with obligation to export to the value of 95.24 per cent. of the total imports within the prescribed period. It was alleged that the petitioner has not reported any export sales of sugar out of the imported raw sugar. Therefore, the petitioner was called upon to state whether the raw sugar imported after proving was sold locally and this sale of imported sugar is liable to be taxed at four per cent. as per entry 61 of Part B of the First Schedule. Though the notice dated June 23, 2006 deals with the o....
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....d. v. State of U. P. reported in [2005] 139 STC 537 (SC); [2005] 4 RC 186 and submitted that the honourable Supreme Court held that it would be unconstitutional for the States to impose any tax on the supply of goods, which are subjected to additional duties of excise. Therefore, the respondents prayed that sales tax may not be imposed on them. From the above, it is seen that the petitioner has submitted their reply to the notice issued by the assessing officer dated June 23, 2006 as well as the notice issued by the enforcement officer dated July 17, 2006 by separate replies dated August 25, 2006. However, no further action was taken for nearly three years and during 2009 the assessing officer, who is a different attacks it to show that there has been a clear transgression of the constitutional principles. This rule is based on the assumption, judicially recognised and accepted, that the Legislature understands and correctly appreciates the needs of its own people, its laws are directed to problems made manifest by experience and its discrimination are based on adequate grounds. The presumption of constitutionality is indeed so strong that in order to sustain it, the court may tak....
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....ure in dealing with complex economic issues." The validity of legislation, it is well-settled, cannot be determined on the basis of its crudities or inequities, particularly when matters of classification in fiscal legislation are involved. The Legislature is not bound to bring within the fold of a provision for the deduction of tax at source, all possible transactions in order for the collection or recovery machinery to be lawful and valid. It is open to the Legislature to impose a requirement that the liability to deduct tax at source would be attracted in those cases where the Legislature or its administrative agency appointed under the law believes that the possibility for evasion must be plugged. Here again, it would be impossible for the Legislature to envisage a situation where every possibility for evasion is ruled out. The Legislature may, however, legitimately target certain specific situations and circumstances where it believes that it is necessary to ensure due protection of the concerns of the revenue by requiring a deduction of tax at source in respect of certain transactions or in certain specified eventualities. These are matters of legislative judgment. Similarly....
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.... grant of exemption. In the light of the above, if sugar is to attract sales tax under the First Schedule, then it must be one other than what is specified for grant of exemption under the Third Schedule. Considering the emphasis in the Third Schedule that the goods produced or manufactured in India as described in the Additional Duties of Excise (Goods of Special importance) Act, 1957 alone is taken up for consideration, the only sugar that can hence fall for consideration under First Schedule must be one other than what is enumerated in the Third Schedule. Rightly, entry 61 of Part B of the First Schedule gave the description of 'sugar' that is sought to be taxed in the First Schedule as, 'sugar imported into India from foreign countries'. Thus irrespective of the kind of sugar, once it is an imported sugar, the sales tax levy under entry 61 of Part B stands automatically attracted to the sales. Thus imported sugar sold as such, retaining its original character attracts tax at four per cent. under the First Schedule to the Act. But when once imported sugar is not dealt with as such for sale, but has been subjected to a manufacturing process, the liability under ....