Punjab-Haryana High Court
State Of Haryana And Others vs Khursheed Ahmad And Others on 1 November, 2012
Author: L.N. Mittal
Bench: L.N. Mittal
Regular Second Appeal No. 3213 of 2009 -1-
IN THE HIGH COURT OF PUNJAB & HARYANA AT CHANDIGARH
Regular Second Appeal No. 3213 of 2009
Date of decision : November 01, 2012
State of Haryana and others
....Appellants
versus
Khursheed Ahmad and others
....Respondents
Coram: Hon'ble Mr. Justice L.N. Mittal
Present : Mr. Rajesh Garg, Additional Advocate General, Haryana
for the appellants
Ms. Anju Arora, Advocate, for the respondents
L.N. Mittal, J. (Oral)
Defendants State of Haryana and others are in second appeal. Suit filed by respondents/plaintiffs was dismissed by the trial court but has been decreed by the lower appellate court.
Facts in this case are not very much in dispute. Plaintiffs purchased wood/timber from Forest Department of State of Haryana. Now the defendants have demanded sales tax on the said transactions from the plaintiffs. Demand notices issued by the defendants regarding demand of Regular Second Appeal No. 3213 of 2009 -2- sales tax from the plaintiffs have been challenged in the suit being illegal, null and void alleging that the plaintiffs are not liable to pay the sales tax. Consequential relief of permanent injunction restraining the defendants from recovering the tax amount from the plaintiffs has also been sought.
Defendants disputed the claim of the plaintiffs and pleaded that plaintiffs are liable to pay the disputed amount of sales tax.
I have heard learned counsel for the parties and perused the case file.
Admittedly, according to terms and conditions of the agreement between the parties regarding sale of wood by defendants to plaintiffs, there is no stipulation as to whether plaintiffs/purchasers or defendants/sellers would be liable to pay sales tax. It is also undisputed that defendants have been registered as 'Dealer' under the Haryana General Sales Tax Act, 1973 (in short, the Act).
Consequently, it has to be examined with reference to provisions of the Act as to who (seller or purchaser of the wood) would be liable to pay sales tax in the absence of any mutual agreement regarding the same between the parties. Section 6 of the Act is the charging provision regarding incidence of taxation. It interalia stipulates that every dealer shall be liable to pay tax under the Act on the sale or purchase of goods by him in the State at the stage provided in the aforesaid section. Rate of tax Regular Second Appeal No. 3213 of 2009 -3- is stipulated in section 15 of the Act. According to section 17 of the Act, tax on declared goods is leviable and payable at the stage of sale or purchase as specified in schedule D whereas under section 18 of the Act, tax on undeclared goods shall be levied at the first sale thereof. According to notification dated 30.12.1987 issued under section 18 of the Act also, tax on timber and its products (including wood-subject matter of this litigation) is payable at first stage of sale. Cumulative effect of these provisions is that tax is payable by the dealer. In the instant case, the defendants are the registered dealer who effected sale of the wood in question. Consequently, sales tax is payable by the defendants in the instant case under the aforesaid provisions of the Act. In view of the aforesaid clear provisions of the Act, the plaintiffs are not liable to pay the disputed amount of sales tax, although for reasons different from those recorded by the lower appellate court.
For the reasons aforesaid, I find no merit in this second appeal which is accordingly dismissed.
( L.N. Mittal )
November 01, 2012 Judge
'dalbir'