The central legal point established in the judgment is the interpretation of the proviso to section 8(1) of the Central Sales Tax Act, 1956, and its application to exemptions from tax generally and not in specified cases or in specified circumstances.

( 1 ) THE petitioner is a dealer in power-loom cloths. The goods with which we are concerned in this case were the subject-matter of inter-State trade, the relevant period being 1st July, 1957, to 31st March, 1958.

( 2 ) UNDER the Mysore Sales Tax Act, 1957, the disputed transactions were not subject to any tax, they being second sales. But the Tribunals below have come to the conclusion that in view of section 8 (1) and (2) of the Central Sales Tax Act, 1956, which came into force on 1st July, 1957, these transactions have become liable to be taxed. They have held that a portion of the turnover, i. e. , Rs. 34,839-77 is liable to be taxed under section 8 (2) and the remaining portion of the turnover, i. e. , Rs. 86,577-49 is liable to be taxed under section 8 (1) of that Act. We may mention at this stage that the latter portion of the turnover is covered by 'c' forms, as required by sub-section (3) of section 8. We have had occasion to consider the scope of section 8 (2) in c. R. P. No. 964 of 1961 (Since reported as Yadalam Lakshminarasimhiah Setty and Sons v. State of Mysore [1962] 13 S. T. C. 583 ). Therein we have opined that he liability of a dealer, excepting as regards the minimum turnover, will under no circumstances be more than what it would have been under the provisions of the appropriate State law, had the disputed transactions related to intra-State sales. From that it follows that in this case the transactions that fall under section 8 (2)cannot be subjected to any tax, as they were not liable to be taxed under the Sales Tax Law of the State.

( 3 ) NOW coming to the other question whether the turnover of Rs. 86,577-49 is liable to be taxed, this question depends upon our decision as regards the scope of the proviso to section 8 (1 ). Before proceeding to deal with the proviso in question, we shall refer to section 8 (1 ). That section reads :

"every dealer, who in the course of inter-State trade or commerce -sells to a registered dealer other than the Government, goods of the description referred to in sub-section (3), shall be liable to pay tax under this Act, which shall be one per cent. of his turnover. "

( 4 ) NOW, we may proceed to consider the proviso. It says "provided that if under the Sales Tax law of the appropriate State the sale or purchase of any goods by a dealer is exempt from tax generally and not in specified cases or in specified circumstances or is subject to tax (by whatever name called) at a rate or rates which is or are lower than the rate specified in sub-section (1), the tax payable under this Act on the turnover in relation to the sale of such goods in the course of inter-State trade or commerce shall be nil or shall be calculated at the lower rate, as the case may be".

The dispute in this case centres round the interpretation to be placed on the words "the sale or purchase of any goods by a dealer is exempt from tax generally and not in specified cases or in specified circumstances. "

( 5 ) ACCORDING to the learned Government Pleader the words "exempt from tax generally" refer to "goods" which were the subject-matter of sale or purchase. But according to Sri Bhat, the learned counsel for the petitioner, those words refer to the sale transaction referred to in section 8 (1 ). In other words, the contention of the Government Pleader is that unless the goods that are the subject-matter of sale or purchase are totally exempt from tax under the appropriate State law the proviso does not come into play. According to him, the proviso does not focus its attention on any particular sale of purchase transaction; it deals with goods which are totally exempt from taxation.

( 6 ) THERE is no doubt that the language employed in the proviso is far from happy. With some exaggeration, one may say that the Legislature has spoken like the proverbial Sphinx. The habit of using unintelligible expressions in fiscal statutes is a hangover of the past. Despite the assurances to the contrary, give