The court established that the green leaves, just like those leaves after they are processed, are liable to sales-tax under the provisions of the Act.

1. The petitioner is the owner of a Tea Estate in this State who having no factory of his own sells his tea leaves as soon as they are plucked. He has been assessed to sales-tax in respect of the green leaves sold by him and the legality of the demand for the period 1.10.1124 to 32.12.1124 is the subject of controversy in this petition.

2. Against the order of assessment made by the Rural Sales-tax Officer, Peermade, the petitioner filed an appeal before the Assistant Commissioner of Agricultural Income Tax and Sales Tax, Kottayam, appeal No. 93 of 1951-52, and the Assistant Commissioner by his order dated 1.10.1951 accepted the petitioner's contention and held that the sales cannot be considered as liable to Sales Tax. The Deputy Commissioner of Agricultural Income Tax and Sales Tax, Trivandrum, however, took up the matter in revision, set aside the decision of the Assistant Commissioner, and confirmed the order of assessment made by the Rural Sales Tax Officer, Peermade. The order of the Deputy Commissioner, D. Dis. 3493/52, dated 18.11.1952, reads as follows:

"The learned Advocate who appears on behalf of the petitioner submits that the turn-over of green leaf of tea is not liable to Sales Tax. He adds that the green leaf of tea does not attract excise duty either. But S.2(1)(a) of the Travancore-Cochin General Sales Tax Act clearly lays down that "agricultural and horticultural produce" shall not be deemed to include tea, coffee, etc. In this view, it is clear that no distinction has to be made between green leaf of tea and manufactured tea for purposes of Sales Tax. Hence an agriculturist who cultivates tea is a dealer who is liable to the levy of Sales-tax under S.3(1)(a) of the Act.

The Assistant Commissioner, Kottayam, in his order dated 1.10.51. D. Dis ST. No. 23/51-52, admits that unfortunately the General Sales Tax Act does not contain any definition of tea. Hence he relies upon the definition prescribed under the Central Excises and Salt Act of 1944 and holds the view that green tea leaf is not assesseable to Sales Tax. The Assistant Commissioner here appears to overlook the prime fact that ordinarily agricultural produce is exempt from the levy of Sales Tax and that an exception is made in the case of tea, rubber, etc. as pointed out supra. In the circumstances, the agriculturist who grows tea is a dealer liable to the levy of Sales Tax and there is, therefore, no need to go to the tea factory owner and the tea manufactured by him. The Central Excise duty applies to manufactured tea only and hence the relevant definition is prescribed under the corresponding Act.

In the result the appeal order passed by the Assistant Commissioner, Kottayam, is set aside and the assessment order passed by the Agricultural Income Tax and Rural Sales Tax Officer, Peermade, dated 6.8.1951 assessing the petitioner on a turn-over of Rs. 8164-14-0 for the last quarter of 1124 allowed to stand. Ordered accordingly".

3. The Sales Tax Act under which the assessment was made is the Travancore General Sales Tax Act, XVIII of 1124. S.3 of that Act provides that subject to the provisions of the Act:

"(a) every dealer shall pay for each year a tax on his total turn-over for such year; and

(b) the tax shall be calculated at the rate of three pies for every Indian Rupee in such turn-over". The definition of the term 'turnover' as given in S.20) of the Act is :

"'turn-over' means the aggregate amount for which goods are either bought by or sold by a dealer, whether for cash or for deferred payment or other valuable consideration, provided that the proceeds of the sale by a person of agricultural or horticultural produce grown by himself or grown on any land in which he has an interest whether as owner, usufructuary mortgagee, tenant or otherwise, shall be excluded from his turn-over".

and of the term "agricultural or horticultural produce" as given in S.2(m) is:

It "agricultural or horticultural produce" shall not be deemed to include tea, coff