1. The assessee, M/s. Allied Chemicals, Kanpur, is a dealer in chemicals.

2. During assessment proceedings under the U. P. Sales Tax Act, 1948 for the assessment year 1956-57 it disclosed that the sales effected by it within Uttar Pradesh during the year amounted to Rs. 7, 642/12/3 and the sales made outside Uttar Pradesh during the same period amounted to Rs. 15, 591/11. The assessee contended that the sales made outside Uttar Pradesh fell outside the purview of the U. P. Sales Tax Act and could not be taken into consideration for any purpose whatsoever under the Act. According to the assessee, if the turnover of the sales made outside Uttar Pradesh was excluded, the turnover of the remaining sales being Rs. 7, 642/12/3 would fall below the prescribed minimum turnover liable to tax and, therefore, the assessee would not be liable to tax at all. The Sales Tax Officer did not accept the contention of the assessee. He held that by virtue of Explanation II to Cl. (h) of S.2 of the Act the sales made outside Uttar Pradesh would be deemed to have taken place in Uttar Pradesh, The Sales Tax Officer, therefore, determined the gross turnover at Rs. 23, 234/7/3 and rejected the contention