C.T. Kochouseph Vs State of Kerala And Another Etc. (Supreme Court of India)
Section 5A of Kerala General Sales Tax and 7A of Tamil Nadu General Sales Tax is constitutionally valid
Supreme Court held that legislations do not levy the purchase tax to tax the transaction of the sale and purchase twice. It levies purchase tax only where no sales tax was payable on the sale. Accordingly, constitutional validity of section 5A of Kerala General Sales Tax Act, 1963 and section 7A of Tamil Nadu General Sales Tax Act, 1959 is upholded.
Facts- The issues that arise for our consideration are whether the purchase of goods by the appellants from dealers who were exempted from payment of tax by virtue of notifications or exemptions issued under the Kerala Act or the Tamil Nadu Act, is a purchase “which is liable to tax” within the meaning of Section 5A of the Kerala Act or Section 7A of the Tamil Nadu Act; whether the appellant-assessee who had purchased goods, that were exempt from payment of sales tax or from the dealers who were exempt from payment of sales tax, are liable to pay purchase tax under Section 5A of the Kerala Act or Section 7A of the Tamil Nadu Act and whether the purchase tax, as imposed by Section 5A of the Kerala Act or Section 7A of the Tamil Nadu Act, is a tax in the nature of manufacture or consignment tax or an inter-state levy, and therefore ultra vires the Constitution and beyond the legislative powers of the state legislature.
