STATE OF MYSORE vs YADDALAM LAKSHMINARASIMHAIAH SETTY AND SONS

The Supreme Court addressed the applicability of the Central Sales Tax Act, specifically Sections 6, 8(2), and 9, in relation to the taxation of inter-state sales of powerloom textiles. The Court held that while Section 6 imposes a tax on inter-state transactions, the liability is contingent upon compliance with other provisions, particularly Section 5(3)(a) of the Mysore Sales Tax Act, which limits tax liability to the first dealer in the State. Consequently, the assessee, not being the first dealer, was not liable for the disputed turnover. The dissenting opinion argued that the High Court erred in exempting non-first sales from tax under the Central Act.