Judgment :- V. RAMASWAMI, J. The respondent assessee is a dealer in fried peas and gram dhall carrying on business at Mayuram. For the asst. yr. 1967-68 he reported a total and taxable turnover of Rs. 69, 080.64 and Rs. 44, 829.59 respectively. The Dy. Commercial Tax Officer determined the total turnover at Rs. 74, 884.30 which included the turnover relating to the second purchase of groundnut kernel amounting to Rs. 27, 947.76, the assessee opted for assessment under S. 7 of the Tamil Nadu General ST Act, 1959, which he was entitled to as the total turnover was less than Rs. 75, 000/- which was the limit prescribed for the relevant assessment year. But he assessing officer did not given him the benefit of this compounded tax under S. 7 but assessed him under s. 3(1) of the Act. The appeal preferred to the AAC was also without any success. The Tribunal held that for the propose of determining the total turnover under S. 7 the turnover relating the second purchase of groundnut kernel is not liable to be included and in that view re-fixed the turnover at Rs. 52, 803.60 after making certain additions to the book turnover returned by the assessee and held assessee liable to pay compounded tax on that basis only. The revision petition has been filed against this order by the Revenue. 2. The question whether the turnover relating to second sales or purchase of declared goods which are exempt from tax is liable to be included for determining the total turnover for the purpose of S. 7 is concluded by our decision in Kannan & Co. vs. The State of Tamil Nadu, T.C. No. 111 of 1970 (1975) CTR(Mad) 263 represented by Dy. Commercial Tax Officer, Kumbakonam. Respondent dt. 3rd March, 1975. While accepting this decision the learned counsel for the assessee contended that for the purpose of determining the compounded tax payable under S. 7 of the Act only the taxable turnover alone shall be taken into account and not the total turnover. Commercial Tax Officer, Kumbakonam. Respondent dt. 3rd March, 1975. While accepting this decision the learned counsel for the assessee contended that for the purpose of determining the compounded tax payable under S. 7 of the Act only the taxable turnover alone shall be taken into account and not the total turnover. This point also in a way we have considered in T.C. No. 111 of 1970 relying on an earlier decision of this Court in Sivamurugan vs. A C.T.O. In that case one of the arguments advanced in support of the contention that these second sales of declared goods are exempted sales and are not liable to be included for the ascertainment of total turnover was that if this turnover was also included that would indirectly be subjected to tax because the compounded rate is determined with reference to the total turnover of the assessee. Repelling this contention the Division Bench held that thought for the purpose of finding out compounded rate of tax even the exempted turnover is included in the total turnover, what was taxed is the turnover which was liable to tax under S. 3(1) of the Act. We have also agreed with this view in our decision in T.C. No. 111 of 1970. Thus, in spite of the fact that for the purpose of determining the total turnover and finding out the eligibility for compounded rate of tax under S. 7 of the Act, the second sales or purchase of declared goods are included, they are not subjected to any tax at all. It is the principle of compounding enunciated in S. 7 that though they are taxing only the taxable turnover, for ascertaining the amount of tax payable the total turnover will have to be taken into account. 3. We therefore do not agree with the learned counsel that by including the second sales or purchase of groundnut kernel in this case and levying the compounded rate on the total turnover tax is levied on the second purchase of groundnut kernel. The order of the Tribunal is therefore liable to be set aside. 4. The result is that for the purpose of determining the total turnover in order to find out the eligibility of the respondent for the benefit of compounded rate under S. 7 the turnover of Rs. The order of the Tribunal is therefore liable to be set aside. 4. The result is that for the purpose of determining the total turnover in order to find out the eligibility of the respondent for the benefit of compounded rate under S. 7 the turnover of Rs. 27, 947.66 which is referable to the second purchase of groundnut kernel will have to be included in the taxable turnover of Rs. 52, 803.60. If so included that total turnover comes to Rs. 80.751.26 exceeding the limit of Rs. 75, 000/- mentioned in S. 7 of the act. Therefore the respondent will not be entitled to the compounded rate under S. 7 of the Act. A revised order will therefore have to be made fixing the tax payable under S. 3(1) of the Act. 5. This revision petition is allowed with costs. Counsel fee Rs. 250/-.