RAMAKRISHNAN, J.

These two tax cases were heard together as they raise a common point. We will take up T.C. No. 105 of 1963 first. The assessee is a dealer in cotton and cotton seeds. During the year of assessment 1960-61 it was found that the dealer had with him, at the close of the year, stock of cotton valued at Rs. 2, 27, 250. Cotton in the year in question was an item of declared goods under section 14 of the Central Sales Tax Act, 1956, it being considered to be of special importance in inter-State trade or commerce. The consequence of such a declaration is, as per section 15(a) of the Central Sales Tax Act, that the sales tax law of a State can levy a tax on the sales or purchases of cotton at a rate which shall not exceed two per cent. and the sales tax shall not be levied at more than one stage. There is a further benefit conferred under section 15(b), that where a tax has been levied under the State law on any declared goods and such goods are sold by the assessee thereafter in the course of inter-State trade or commerce, the tax shall be refunded to the assessee subject to certain conditions. We are not now concerned with this last mentioned provision for refund. Acting upon section 15(a) of the Central Sales Tax Act, the Government of Madras provided for the tax on declared goods, in section 4 of the Madras General Sales Tax Act, 1959, which states that tax in respect of declared goods shall be paid at the rate and only at the point specified against each in the Second Schedule on the turnover in such goods in each year, whatever be the quantum of turnover in that year. In the Second Schedule "cotton" is entered as item 2 and the single point of levy adopted is "at the point of last purchase in the State" and the rate of tax is not per cent. Adopting the interpretation to the words "last purchase in the State" given by the Kerala High Court in Abdulsalam Rowther v. State of Kerala and the Mysore High Court in Hormusji Hirjibhoy and Co. v. Commercial Tax Officer the assessing authority in this case levied sales tax on the unsold stock remaining with the assessee at the end of the year, holding that the purchases in respect of it must be deemed to be the last purchase in the State, and liable to be assessed under section 4 of the Madras General Tax Act read with Schedule II to it. The gist of the view of the Kerala and Mysore High Court is that for the purpose of the levy of sales tax, the year shall be taken as the unit, that no event that happens either before or after the year shall be taken into account for the purpose of deciding the stage of single point levy, and that therefore the last purchase should be deemed to be the last purchase so far as the year of assessment is concerned. Against the decision of the assessing authority, the appeal filed to the Appellate Assistant Commissioner failed; but the Sales Tax Tribunal allowed the further appeal of the assessee. Now the State has come before us in revision against the decision of the Tribunal.We will briefly refer to the Kerala and Mysore High Court decisions on which reliance has been placed by the department. In Abdulsalam Rowther v. State of Kerala the Kerala High Court had to interpret a provision for single point levy described as

"last purchase in the State which is not exempt from taxation under section 3(3) of the Act." *

The dealer in that case at the conclusion of the assessment year had a certain quantity of unsold stock. He asserted that after the assessment year he had sold that stock to the other assessable dealers in the State and therefore he was not the last purchaser liable to assessment. The Kerala High Court relied upon certain decisions under the Indian Income-tax Act, which lay down that for the purpose of computing yearly profits and gains, each year is a separate self-contained period of time in regard to which profits earned or losses sustained before its commencement are irrelevant. One of them is Commissioner of Income-ta