A 'Another instance I can conceive of is a case of a dealer selling agricultural or horticultural produce grown by him or 1 grown in any land in which he has interest, whether as owner, usufructuary mortgagee, tenant or otherwise. From the definition of ·'turnover' in section 2(xxvii) of the Act it is evident that the proceeds of such sale would be excluded from the turnover of a person who sells goods produced by him by B ' 1nanufacture, agriculture, horticulture or otherwise, thougt1 merely by such sales he satisfies the definition of a "dealer'' in the Act. Thus, such a person selling such produce is treated as a dealer within the meaning of the Act and the sales are of goods which are taxable under the Act but when he sells these goods, it is not part of his turnover. Therefore, it is a case o[ a dealer selling goods liable to tax under the C Act in circumstances in which no tax is payable under the Act. In such a case, the purchaser is sought to be taxed under section SA provided the conditions are satisfied. The case of growers selling goods to persons to whom section SA thus applies is covered by this example." The judgment of the learned Judge was affirmed in appeal by a D Division Bench of the same High Court (vide, Yusuf Shabeer and ors. • State of Kerala and Ors.(1 ) The Bench expressly dissented from the view taken by the Madras High Court in the judment now ander now ander • In our opinion, the Kerala High Court has correctly construed SA of the Kerala Act which is in pari materia with the impugned E 7 A of the Madras Act. "Goods the sale or pttrchase of which is to tax under this Act in s. 7A(1)" means 'taxable goods'. tltc.t " ! the kind of goods, the sale of which by a particular person or dealer may not be taxable in the hands of seller but the purchase of the same by a dealer in the course of his business may subsequently become We have pointed out and it needs to be emphasised again that Section 7 A itself is is a charging section. It creates a liability against F - a dealer on his purchase turnover with regard to goods, the sale or purchase of which though generally liable to tax under the Act, have not due to the circumstances of particular sales, suffered tax under 3, 4 or 5. and which after the purchase, have been dealt bv ' him in any of the modes indicated in clauses (a), (h) and (c) cif 7-A(l). G • For the forcgoi'!g reasons, we allow these appeals, set aside the Judgment of the Htgh Court and dismiss to writ petitions. In the ctrcumstances, we would leave the parties to bear their own cos'.s. All the cases will now go back to the taxing authority concerned for furthr investigat~on, proceedings or action as may be necessary ( m the particular case, m accordance with law as clarified above. H Apptals allowed.
