Karnataka Sales Tax Act, 1957 – ss.2(u-2) and 6-B(1) – Turnover tax under s.6-B – Basis for levy – Submission for the appellant that the ‘total turnover’ in s.6-B(1) is to be read as ‘taxable turnover’ and the determination of the rate of the turnover tax is to be ascertained on ‘taxable turnover’ – Held: Submission is unsustainable – Except the deductions provided under the first proviso to s.6-B(1) nothing else is to be deducted from the total turnover as defined under s.2(u-2) for the purpose of levy of turnover tax under s.6-B of the Act.
Dismissing the appeals, the Court
HELD: 1. The expression “total turnover” and “turnover” which has been used under Section 6-B has the same meaning as defined under Section 2(1)(u-2) and 2(v) of the Act. Under Section 6-B, reference is made on ‘total turnover’ and not the ‘turnover’ as defined under Section 2(v) of the KST Act and taking note of the exemption provided under first proviso clause(iii), exclusion has been made in reference to use of sale or purchase of goods in the course of inter-state trade or commerce. It clearly indicates that the expression ‘total turnover’ which has been incorporated as referred to under Section 6-B(1) is for the purpose of identification of the dealers and for prescribing different rates/slabs. The first proviso to Section 6-B(1) provides an exhaustive list of deductions which are to be made in computation of such turnover with a further stipulation as referred to in second proviso that except for the manner provided for in Section 6-B(1), no other deduction shall be made from the total turnover of a dealer. [Para 9] [517-A-C]
M/s. Hoechst Pharmaceuticals Ltd. and Others v. State of Bihar and Others (1983) 4 SCC 45 : [1983] 3 SCR 130; Commissioner of Customs(Import), Mumbai v.. Dilip Kumar and Company and Others (2018) 9
SCC 1 : [2018] 7 SCR 1191 – relied on.
2. In construing penal statutes and taxation statutes, the Court has to apply strict rule of interpretation. In the instant scheme of the Act, the expression ‘total turnover’ has been referred to for the purpose of identification/classification of dealers for prescribing various rates/slabs of tax leviable to the dealer and read with first and second proviso to Section 6-B(1), this makes the intention of the legislature clear and unambiguous that except the deductions provided under the first proviso to Section 6-B(1) nothing else can be deducted from the total turnover as defined under Section 2(u-2) for the purpose of levy of turnover tax under Section 6-B of the Act. [Paras 11, 12] [518-G; 519-G-H; 520-A-B]
Rakesh Kumar Paul v. State of Assam (2017) 15 SCC
67 : [2017] 8 SCR 785 ; Subramanian Swamy and Others v. Raju through Member, Juvenile Justice Board and Another (2014) 8 SCC 390 : [2014] 9 SCR 283 – held inapplicable.
Indra Das v. State of Assam (2011) 3 SCC 380 : [2011] 4 SCR 289 – referred to.
As published in the Supreme Court Reports, Supreme Court of India. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
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