JUDGMENT G. C. Bharuka, J. - Pursuant to the directions of this Court the Commercial Taxes Tribunal, Bihar, Patna, has referred the following two questions for consideration to this Court : "1. Whether in the facts and circumstances of the case the Tribunal was justified in holding that the applicant was liable to pay special sales tax on the sale of fertilizers which it has purchased from the Fertilizer Corporation of India on account of non-production of declaration in form IXC and whether the requirement of production of declaration in form IXC is mandatory for grant of exemption ? 2. Whether under the admitted facts and circumstances of the case, the incidence of sales tax in respect of the amount of Rs. 2,60,43,960.04 being the amount recovered through fair price shop for supply to them under the order of the State Government of rice procured under the Bihar Essential Foodgrains Procurement Order, 1968, fell on the petitioner ?" The proceedings relate to the financial year 1969-70. The Food Corporation of India, which is the assessee, is a Corporation established by the Central Government under section 3 of the Food Corporation Act, 1964. It is engaged in purchase and sale of foodgrains and fertilizers and is a registered dealer under the provisions of the Bihar Sales Tax Act, 1959 (hereinafter for brevity "the Act" only). The basic facts, as found by the Tribunal, are being noticed hereunder. The assessee had purchased fertilizers worth Rs. 34,19,997.92 from M/s. Fertilizer Corporation of India and it sold the same for Rs. 36,59,570.92. During the course of assessment proceedings, the assessing officer on examination of book of accounts and verification of purchase invoices, having been fully satisfied that the assessee had paid tax on purchase of fertilizers to the selling dealer, except for a sum of Rs. 2,39,573.00, allowed deduction of Rs. 34,19,997.92 from the gross turnover. The assessee being aggrieved by part disallowance, went in appeal before the Deputy Commissioner, who instead of granting any relief, reversed the order of the assessing officer on the ground that since the petitioner had not furnished declarations in form IXC duly issued by the selling dealer, notwithstanding the fact that he had paid the tax, the deduction was not permissible in law. According to him the provisions relating to furnishing of the said declarations was mandatory for claiming desired deduction. According to him the provisions relating to furnishing of the said declarations was mandatory for claiming desired deduction. On revision the Tribunal affirmed the view of the appellate authority. These facts have given rise to first question. So far as the second question is concerned, the relevant facts are that under the provisions of the Bihar Essential Foodgrains Procurement Order, 1968 issued by the State of Bihar under section 3 of the Essential Commodities Act, 1955 the assessee was appointed as the procurement agent to compulsorily purchased rice from the millers, dealers and cultivators at procurement rates and thereafter supply the same as per the directions of the Government to the fair price shop dealers. The fair price shop dealers, apart from paying the cost of rice to the Food Corporation of India being at the rate of Rs. 111.17 per quintal, were also required to deposit Rs. 6.83 in the treasury in the State Government's account being Rs. 3.50 per quintal towards incidental charges land Rs. 3.33 per quintal against sales tax under the Act. In view of these facts the assessing officer granted the exemption to the petitioner in respect of the transactions of sales to fair-price shop dealers but the Deputy Commissioner on appeal reversed the finding on this score as well by holding that the assessee being the first seller was liable to pay sales tax irrespective of the fact whether any amount had been deposited by the purchaser in the Government account or not. The Tribunal in order to resolve the dispute amicably, took the view that instead of approaching the dispute by pursuing through legal technicalities, it is better that the assessing officer examine the contention of the petitioner and if it is found that the State Government in the department of supply and commerce has been assessed in respect of these transactions, then the assessee will not be assessed in respect thereof. But the assessing officer has postponed to act in accordance with the directions of the Tribunal on the ground of pendency of the present reference. But the assessing officer has postponed to act in accordance with the directions of the Tribunal on the ground of pendency of the present reference. Dealing first with the second question, it is suffice to state that since the Tribunal has refrained from entering into the question of liability of the petitioner based on the plea as to who in fact will be deemed to be the first seller in the State of Bihar in respect of rice procured under the provisions of the procurement order and has directed that if the State Government has already been subjected to tax liability in respect of the transactions, then the assessee cannot be again made liable to pay tax in respect of such transactions, in my opinion, it is neither necessary nor permissible to examine the legal aspects touching upon the strict liability by examining and considering the provisions of the Act. In my opinion, since it has been found as a fact by the Tribunal that the fair price shop dealers have already deposited Rs. 3.33 per quintal as sales tax in the treasury in respect of each and every transaction, the Commercial Taxes Department should have felt satisfied with appropriation of the said amount deposited in its own account without unnecessarily quarrelling on the question of liability. It was so advisable because in respect of a particular transaction it could have recovered the tax only at one point and it was wholly immaterial whether the amount of sales tax deposited by the fair price shop dealers should be treated as the liability of the assessee, i.e., agent or the State Government, being the principal. In this view of the matter we refrain from answering question No. 2 as framed since on the facts and in the circumstances of the present case, it will be a futile exercise. So far as the first question is concerned, Mr. J. N. Sahay, learned counsel for the petitioner, by inviting our attention to various provisions of the Act, Rules and notifications has submitted that under the scheme of the Act, the requirement prescribed for production of the declarations in form IXC was merely a mode of proof prescribed for ascertaining that the goods in question have been subjected to special tax at the specified point in the series of transactions. According to him the notification itself provides for production of other documents like original copy of the cash memoranda or the bill issued to the assessee by the selling dealer and if from the said documents it becomes ascertained that the goods have suffered the incidence of special tax, then non-production of the declaration per se cannot be said to be a ground for taxing goods twice over. According to him under the scheme of the Act, the special sales tax can be levied at only one stage in the series of transactions and this provision being an integral part of charging section and mandatory in nature, the other provisions including the Rules and notifications need to be interpreted in a manner which will avoid levy of tax at multi-points. The substance of his submission is that if the provisions are construed as directory then it will not only be consistent with the mandate of the charging section rather it will also save the assessee from undue hardships without in any way telling upon the interest of the revenue. On the other hand, Mr. P. K. Sahi, learned State counsel, has submitted that in truth and substance the claim of the petitioner is one of exemption and not of non-taxability and, therefore, it is incumbent upon him to satisfy the requirement of production of statutory declarations in form IXC in order to avail of the exemption as claimed. Such provisions, according to him cannot be treated as merely directory. Mr. Sahi by inviting our attention to the third proviso to section 7(2)(b) submitted that the assessee can claim deduction of certain sales from his gross turnover only if he satisfies the conditions enumerated in the notifications. The learned counsels have relied upon various decisions in support of their submissions with which I will be dealing hereinafter but before further proceeding to examine the submissions made at the Bar it will be worthwhile to quote the relevant provisions having bearing on the question referred. "Section 2(s) 'tax' includes the general sales tax and special sales tax as also the purchase tax levied under section 3. Section 3 : Charge of tax. "Section 2(s) 'tax' includes the general sales tax and special sales tax as also the purchase tax levied under section 3. Section 3 : Charge of tax. - (1) Subject to the provisions of this Act, both general sales tax and special sales tax as also purchase tax shall be paid by every dealer - (a) with effect from the date of commencement of Bihar Finance Act, 1966, if his gross turnover during a period not exceeding twelve months immediately preceding the said date exceeded Rs. 15,000; (b) to whom clause (a) does not apply, with effect from the expiry of thirty days from the date on which his gross turnover during a period not exceeding twelve months immediately preceding such date first exceeded Rs. 15,000. Section 4 : Exemption. - (1) No tax shall be payable under this Act on sales or purchases of goods which have taken place - (a) in the course of inter-State trade or commerce; (b) outside the State; (c) in the course of import of goods into, or export of the goods out of the territory of India. (2) The provisions of the Central Sales Tax Act, 1956 (74 of 1956) shall apply for determining when a sale or purchase of goods shall be deemed to have taken place in any of the ways mentioned in clause (a), (b) or (c) of sub-section (1). (3) The State Government may, by notification and subject to such conditions or restrictions as it may impose, exempt from the levy of the general sales tax or special sales tax or both or the levy of purchase tax - (a) sales of any goods or class or description of goods; (b) sales of any goods or class or description of goods to or by any class of dealers; (c) any sale or category or description of sales, and (d) purchase of any goods declared under section 3A by any class of dealers or any purchase or category or description of purchases of such goods. (4) Where exemption from the levy of tax under this Act on any sale or purchase of goods is claimed by a dealer under the provisions of this section or sub-clauses (2) or (3) of section 7 the burden of proof shall lie on such dealer and the prescribed authority may require the dealer to substantiate the claim in the prescribed manner. Section 5 : Point in the series of sales at which the special sales tax shall be levied. - The special sales tax shall be levied only at that point in the series of sales at which the goods are sold to a person other than a registered dealer in whose registration certificate such goods or class or description of goods are specified as being required for resale by him or for use by him in the packing of goods which he sells : Provided that the State Government may, in respect of any goods or class or description of goods or any class of dealers notified in this behalf, direct that the said tax shall, subject to such conditions and restrictions as may be specified in the notification, be paid at any other point. Section 6 : Rates of tax. - (1) The general sales tax payable by a dealer under section 3 shall be levied at the rate of 1 per centum of his taxable turnover : Provided that the State Governments may, from time to time by notification, and subject to such conditions and restrictions as it may impose, fix a higher rate not exceeding 2 per centum in respect of such class of dealers or such goods, class or description of goods or such sales, category or description of sales as may be specified in the notification. (2) The special sales tax payable by a dealer under section 3 shall be levied at the rate of 4 per centum of his taxable turnover : Provided that the State Government may, from time to time, by notification and subject to such conditions and restrictions as it may impose, fix a higher rate not exceeding 15 per centum or any lower rate not below 2 per centum in respect of such class of dealers or such goods, class or description of goods or such sales, category or description of sales as may be specified in the notification. (2A) The purchase tax payable by a dealer under section 3 on goods declared under section 3A shall be levied at the rate of 5 per centum of his taxable turnover of purchases : Provided that the State Government may, from time to time by notification, and subject to such conditions and restrictions as it may impose, fix a higher rate not exceeding 15 per centum, or any lower rate not below 1 per centum in respect of such class of dealers or such goods or such purchases as may be specified in the notification. (3) Notwithstanding anything contained in this Act, the levy of the tax payable by a dealer under this Act on sales or purchases of declared goods made by him inside Bihar shall be subject to the restrictions and conditions contained in section 15 of the Central Sales Tax Act, 1956 (LXXIV of 1956). Section 7 : Taxable turnover. - For the purpose of this Act, 'the taxable turnover' of a dealer shall be - (1) ....................... (2) in respect of special sales tax, that part of the gross turnover which remains after deducting therefrom - (a) ....................... (b) subject to the provisions of section 5, sale prices on account of sales to a registered dealer other than a dealer liable to pay tax under sub-section (8) of section 3, of goods specified in his registration certificate as being required - (i) for resale by him inside Bihar or in the course of inter-State trade or commerce or export out of the territory of India, or (ii) for use by him in the packing of goods which he sells inside Bihar or in the course of inter-State trade or commerce or export out of the territory of India : ................ Provided further that where any goods exempted from the levy of tax by a notification issued by the State Government in this behalf under sub-section (3) of section 4 are purchased by a dealer after furnishing declaration mentioned in the notification or where any goods specified in the certificate of registration of a dealer are purchased by him after furnishing a declaration as provided in the first proviso of clause (2) but are utilised by him for any purpose other than those specified in such a notification or specified in items (i) or (ii) of sub-clause (b) of clause (2), as the case may be the sale price of the goods so purchased shall, without prejudice to any action which is or may be taken under section 38, be deducted from the gross turnover of the selling dealer but shall be included in the taxable turnover of the purchasing dealer : Provided also that where tax is leviable in respect of sale of any goods or class or description of goods at any other specified point under sub-section (3) of section 5, the deduction envisaged under sub-clause (b) of clause (2) shall not apply at the point so specified and in such cases the sale prices of such goods at all other points shall be deducted subject to such conditions and restrictions as the State Government may, by notification, impose in this behalf :" Rule 8(2) of the Bihar Sales Tax Rules, 1959 reads as under : "A dealer who claims that any amount of his turnover should be exempted from special sales tax on account of the goods having been subjected to such tax in accordance with a notification issued by the State Government under the proviso to section 5, shall substantiate such claim before the authority prescribed in rule 12, by producing the purchase orders, if any, the original copy of the cash memoranda or bills issued to him and a true declaration in writing from the selling dealer (or his manager declared under section 10 in writing) in form IXC obtained from the prescribed authority, that the goods in, question have already been subjected to special sales tax." Notification No. STGL-RT-9/65 - 12919-F.T., dated 11th November, 1966 as amended by STGL-AR-1006-68 - 8548-F.T., dated 10th September, 1968 so far as it relates to fertilizers reads as under :- In exercise of the powers conferred by the proviso to section 5 of the Bihar Sales Tax Act, 1959 (Bihar Act XIX of 1959), and in supersession of all the previous notifications on the subject, the Governor of Bihar is pleased to direct that the 'special sales tax' leviable under the said Act on the sale of the goods specified in the second column of the Schedule hereto annexed shall be levied at the stage specified in the third column of the Schedule, subject to the conditions and restrictions set out in the fourth column thereof. -------------------------------------------------------------------------------- Sr. No. Description Stage at which Conditions and restrictions of goods. special sales tax subject to which exemption shall be levied. from special sales tax shall be allowed at subsequent stage. -------------------------------------------------------------------------------- (1) (2) (3) (4) -------------------------------------------------------------------------------- Fertilizers (a) If the goods If the selling dealer at the are imported from subsequent stage produces a place outside before the assessing Bihar, at the authority purchase orders, if point of sale by any, the original copy of the importer; and the cash memoranda or bills issued to him by the (b) in other cases, dealer from whom he at the point of purchased the goods and a first sale in the true declaration in writing State. in form IXC appended to the Bihar Sales Tax Rules, 1959 from such dealer or his manager declared under section 10 of the Bihar Sales Tax Act, 1959. -------------------------------------------------------------------------------- Form IXC prescribed under the Rules is to the following effect : Form IXC Form of declaration under the Bihar Sales Tax Rules, 1959. Book No. ................ Serial No. ............... 1. I/We ............... (Name and style of business), Registration No. .................. do hereby declare that I/We, have sold ........................ (goods) ...................... (quantity) for Rs. ...................... (value) to M/s. ................. in my/our cash memo/bill No. ................. dated ................... 2. I/We further declare that the goods were subjected to special sales tax at the point of sale in Bihar by M/s. ...................... (Full address). Registration No. ................. being importer/manufacturer/selling agent/dealers to M/s. ....................... (full address) Registration No. .......................... Place .................... Date ..................... Signature and status of the person signing the declaration. To appreciate the rival claims it is essential to have a conspectus of the charging pattern envisaged under the Act. Section 4 is the core. It makes every dealer liable to pay sales tax, both general and special, in accordance with the provisions of the Act. The levy of special sales tax is governed by section 5 and section 6(2). Section 5 provides for the point in the series of sales of specified goods at which the special sales tax is to be levied and section 6(2) deals with the rate of such tax. In this case, we are concerned with the question of determining the point or points at which the special sales tax is permissible to be levied. Section 5 provides for the point in the series of sales of specified goods at which the special sales tax is to be levied and section 6(2) deals with the rate of such tax. In this case, we are concerned with the question of determining the point or points at which the special sales tax is permissible to be levied. In substance, we have been called upon to determine the taxable event or events showering tax liability on certain class of dealers who can be termed as taxable persons. In section 5 of the Act, the Legislature has plainly pronounced that the special sales tax shall be levied only at one point in the series of sale of the goods. The Legislature has identified the point being at which the goods are sold to a person other than the category of registered dealer referred to therein. But the proviso has enabled the State Government to specify any other point for levy of special sales tax in respect of "any goods or class or description of goods or any class of dealers" subject to such conditions and restrictions as may be notified. The question is whether this section postulates single point taxation or multiple. In my opinion, by adhering to the rules of interpretation and particularly those applicable to taxing statutes, which commands gathering of legislative intent, from the plain reading of the statute itself, section 5 speaks of levy of special tax only at one point. This means that the special sales tax can be levied and collected only from one registered dealer in the series of sales whereunder the specified goods have passed through the hands of different dealers. If this be the legislative mandate, then all subsidiary provisions and delegated acts have to be construed, interpreted and understood in a sense which will make them consistent with the legislative intent. Any overreaching or overdoing may result in annulling such subordinate acts as being hit by the doctrine of ultra vires. The expression "subject to such conditions and restrictions as may be specified" used under the proviso to section 5 of the Act cannot be interpreted as authorising the State Government to levy such conditions and restrictions, in the mandatory sense, so as to make the levy of special sales tax as multi-point thereby setting at naught the very legislative scheme. The expression "subject to such conditions and restrictions as may be specified" used under the proviso to section 5 of the Act cannot be interpreted as authorising the State Government to levy such conditions and restrictions, in the mandatory sense, so as to make the levy of special sales tax as multi-point thereby setting at naught the very legislative scheme. Subject to constitutional limitations, the Legislature is always competent to make the levy single point or multi-point. If any condition or restriction is notified then non-fulfilment thereof can only alter the point of levy in the series of transactions but the non-fulfilment cannot make the levy multi-point. I may not be misunderstood to have taken a view that the State Legislature is not competent to devise the multi-point scheme. My only endeavouring is to ascertain as to whether the Legislature had intended to do so under the present Act. The tax has been levied under three nomenclatures, namely, general sales tax, special sales tax and purchase tax. So far as the general sales tax is concerned, under section 6(1) its measure has been devised to be the taxable turnover of the dealer. This levy is not dependent on the transaction of any specified goods. Every dealer is liable to pay general sales tax as a particular percentage of his taxable turnover and if the same goods in a series of transaction are sold consecutively by different dealers, the sale price of those very goods in the hands of each of the selling dealer will form part of his taxable turnover. Thus, so far as the general sales tax is concerned, it is multi-point in nature, if viewed from sale aspect of specified goods, but this is not the situation in relation to special sales tax or purchase tax. These taxes can be levied only against one dealer in relation to same the goods, even if the goods are subjected to multi-point intra-State sales. Now let me deal with the notification dated November 11, 1966 read With notification dated September 10, 1968 which is relevant for the present purpose, though a notification in similar terms dated March 31, 1974 had also been issued by the State Government possibly because of the substitution of section 5 by Bihar Act 11 of 1973. Column (3) of the Schedule to the notification provides the stage at which the special sales tax shall be levied. Column (3) of the Schedule to the notification provides the stage at which the special sales tax shall be levied. Column (4) of the said Schedule lays down the conditions and restrictions subject to which exemption from special sales tax shall be allowed at subsequent stages. Column (3) makes the levy first point as commonly understood and it is quite consistent with the authority delegated to State Government under the proviso to section 5 but so far as the conditions laid down under column (4) referred to above are concerned, this pertains to grant of exemption at subsequent stage and it says that : "If the selling dealer at the subsequent stage produces before the assessing authority purchase orders, if any, the original copy of the cash memoranda or bills issued to him by the dealer from whom he purchased the goods and a true declaration in writing in form IXC appended to the Bihar Sales Tax Rules, 1959, from such dealer or his manager declared under section 10 of the Bihar Sales Tax Act, 1959." As noticed above, the notification in question provides for two things, namely, (i) the point of levy, and, (ii) the conditions subject to which a dealer will be entitled to exemption at subsequent stage. So far as the point of levy is concerned, it has not been circumscribed by any conditions and restrictions. The declaration is absolute in terms. Therefore, special sales tax can be levied on the sale of fertilizer only at the first point. So far as the conditions and restrictions laid down under column (4) of the Schedule, as quoted above, are concerned, if construed strictly those will have to be taken as nugatory. Because if in law, the sale of fertilizer is taken to be taxable at first point, then keeping in view the single point scheme of taxation, the sale of such stocks of fertilizer at subsequent stage will form part of non-taxable turnover, and not of exempted turnover depending on fulfilment of any condition or restriction. It is also important to notice here that the State Government has been invested with the power to grant exemption under section 4(3) of the Act and it does not authorise the grant of exemption in relation to special sales tax at any specified stage. It is also important to notice here that the State Government has been invested with the power to grant exemption under section 4(3) of the Act and it does not authorise the grant of exemption in relation to special sales tax at any specified stage. It authorises the State Government to grant exemption in relation to goods or the dealers or a sale or category or description of sales. In view of this discussion, in my opinion, possibly what the Government intended by providing the conditions and restrictions in column (4) was to provide a more thorough documentary evidence to ascertain as to whether the dealer claiming deduction of a particular turnover pertaining to goods subject to first point taxation, is making a correct statement or not. In other words, on the basis of some reliable document it was required to be ascertained as to whether the dealer under the assessment is a first seller or a second or subsequent seller. If the dealer is able to convince and prove on the basis of any acceptable evidence that the sale in hand is second or subsequent sale, then, he has got to be exonerated from the tax liability because taxable event in relation to such goods had already passed. Keeping in view the discussions made hereinbefore it has to be held that the conditions laid down under column (4) of the Schedule to the notification dated September 10, 1968, referred to above, are merely directory in nature and strict non-compliance thereof per se cannot be a ground for not accepting the claim of deduction of the concerned dealer. I may clarify that even if the provisions are not mandatory, the deductions cannot be allowed to the dealer unless he satisfied that he had purchased the goods from a dealer registered under the Act. So far as the rule 8(2) of the Bihar Sales Tax Rules, 1959 is concerned, it being almost in the same terms as contained under column (4) of the Schedule to the notification dated September 10, 1968, referred to above and for the reasons, as set out above, I can conveniently hold that this rule should also be taken as directory. I may also notice here that under the proviso to section 5, the terms and conditions for the purpose of the said proviso could have been laid down only by a notification and not under the Rules. The distinction between the statutory instruments like the notification and Rules is now well-accepted. If the Legislature mandates the exercise of delegated power through a notification, it cannot be done by Rules. One of the reasons for taking the view is that making of subordinate legislations through different modes is subjected to various limitations, like the laying clauses, requirement of previous publication, etc. In case of Atlas Cycle Industries Ltd. v. State of Haryana, reported in AIR 1972 SC 121 it has been held that : "The word 'notification' cannot be said to be synonymous with rules, bye-laws, orders, directions and powers for two reasons. First, the Act in the present case speaks of notifications for imposition of tax and uses the word 'notification' separately from the other words 'rules, bye-laws, orders, directions and powers'. ......... Secondly the General Clauses Act in section 21 speaks of power to issue notifications, orders, rules or bye-laws and it is, therefore, apparent that the power to issue notifications, orders, rules or bye-laws refers to different and separate methods of expression of exercise of power under the statute. Section 62(10) of the Act speaks of notification of the imposition of tax. Such a notification is the statutory basis of imposition and levy of tax." In the case of Suleman Mian v. State of Bihar reported in 1975 BBCJ 352 , N. P. Singh, J. (as he then was) has held that under the provisions of the Prevention of Food Adulteration Act, 1954, the local authority was required to be declared under the Rules but the same was done by a notification and as such in law there was no declaration at all. Mr. Mr. P. K. Sahi has also relied on the third proviso to section 7(2)(b), which is in the following term : "Provided also that where tax is leviable in respect of sale of any goods or class or description of goods at any other specified point under sub-section (3) of section 5, the deduction envisaged under sub-clause (b) of clause (2) shall not apply at the point so specified and in such cases the sale prices of such goods at all other points shall be deducted, subject to such conditions and restrictions as the State Government may, by notification, impose in this behalf;" In my opinion, the provision in question does not in any way improve the stand point of the State for more than one reason. Firstly, no notification in terms of the said provision has been issued by the State Government and as such the said provision is of no consequence in the present case. Secondly, section 7 merely provides a mode of computation of taxable turnover and is, therefore, in the nature of a machinery section. Such provision has to be read in the light of the statutory scheme and the charging section which are always strictly construed. In case of conflict, the charging section has to prevail, and if necessary, the machinery section has to suffer violence to its language to accommodate the contemplation under the charging section. Therefore, in my opinion, it is not necessary to deal with the section in any further detail. Now let me deal with the precedents cited at the Bar. In the case of the State of Orissa v. M.A. Tulloch and Co. Ltd. reported in [1964] 15 STC 641, the question which fell for consideration before the Supreme Court was as to whether rule 27(2) of the Orissa Sales Tax Rules, 1947, requiring, furnishing of a declaration in writing by the purchasing dealer for claiming deductions by the selling dealer under section 5(2)(a)(ii) of the Orissa Sales Tax Act was mandatory. Under the Act, a selling dealer was entitled to a deduction in respect of sales to a registered dealer of goods, if the goods were specified in the purchasing dealer's certificate of registration as being intended for resale by him in Orissa. The Rules required production of declaration for claiming the said deduction. Under the Act, a selling dealer was entitled to a deduction in respect of sales to a registered dealer of goods, if the goods were specified in the purchasing dealer's certificate of registration as being intended for resale by him in Orissa. The Rules required production of declaration for claiming the said deduction. Repelling the contentions advanced on behalf of the State that rule 27(2) has chosen one exclusive method of proving a fact essential for claiming deduction and therefore, no other method of proving that fact is permissible, their Lordships have held : "In our opinion, rule 27(2) must be reconciled with the section and the rule can be reconciled by treating it as directory. But the rule must be substantially complied with in every case. It is for the Sales Tax Officer to be satisfied that, in fact, the certificate of registration of the buying dealer contains the requisite statement, and if he has any doubts about it, the selling dealer must satisfy his doubts. But if he is satisfied from other facts on the record, it is not necessary that the selling dealer should produce a declaration in the form required in rule 27(2), before being entitled to a deduction." A Bench of this Court in the case of Budhram Kashiram v. State of Bihar reported in [1978] 41 STC 201, following the case of the State of Orissa [1964] 15 STC 641, took the same view as the Supreme Court while considering the rule 18 of the Bihar Sales Tax Rules, 1949, by holding that the provisions contained in the said rule were directory. Mr. P. K. Sahi for the State, relied on two subsequent Supreme Court judgments in the cases of Kedarnath Jute Manufacturing Co. Ltd., v. Commercial Tax Officer reported in [1965] 16 STC 607 and Commissioner of Sales Tax v. Prabhudayal Prem Narain reported in [1988] 71 STC 1 and thereby submitted that the provisions requiring furnishing of statutory declaration should be held as mandatory. In Kedarnath Jute Manufacturing Co. Ltd. [1965] 16 STC 607 (SC) the question involved was as to whether under section 5(2)(a)(ii) of the Bengal Finance (Sales Tax) Act, 1941, the furnishing of declaration forms issued by the purchasing dealer was a condition for claiming exemption thereunder. In Kedarnath Jute Manufacturing Co. Ltd. [1965] 16 STC 607 (SC) the question involved was as to whether under section 5(2)(a)(ii) of the Bengal Finance (Sales Tax) Act, 1941, the furnishing of declaration forms issued by the purchasing dealer was a condition for claiming exemption thereunder. Dealing with the question their Lordships held that : "Section 5(2)(a)(ii) of the Act in effect exempts a specified turnover of a dealer from sales tax. The provision prescribing the exemption shall, therefore, be strictly construed. The substantive clause gives the exemption and the proviso qualifies the substantive clause. In effect the proviso says that that part of the turnover of the selling dealer covered by the terms of sub-clause (ii) will be exempted provided a declaration in the form prescribed is furnished. To put it in other words, a dealer cannot get the exemption unless he furnishes the declaration in the prescribed form." It was primarily for the aforesaid reason that their Lordships have held the provisions to be mandatory. Their Lordships distinguished their earlier decision in the case of State of Orissa [1964] 15 STC 641 (SC), by holding that section 5(2)(a)(ii) of the Orissa Act did not contain any provision similar to one at hand. It was noticed that in the Orissa case the Rules were held to be directory in order to reconcile the same with the provisions of the Act and to avoid any conflict. In the subsequent judgment in the case of Commissioner of Sales Tax v. Prabhudayal Prem Narain [1988] 71 STC 1, the Supreme Court has merely followed its dictum in Kedarnath jute manufacturing Co. Ltd., [1965] 16 STC 607. The other cases cited at the Bar being not very material for adjudication of the question at hand are not being discussed. The distinction between the two line of cases, referred to above, is quite glaring and is of most importance. The case of State of Orissa [1964] 15 STC 641 (SC) was a case relating to deduction from the turnover on establishment of certain facts which could have been ascertained through various evidences. The requirement of furnishing declaration had stemmed not from the provisions of the Act but from the Rules framed thereunder. The case of State of Orissa [1964] 15 STC 641 (SC) was a case relating to deduction from the turnover on establishment of certain facts which could have been ascertained through various evidences. The requirement of furnishing declaration had stemmed not from the provisions of the Act but from the Rules framed thereunder. Under the Act, the deduction was not dependent on furnishing of any declaration but was dependent on establishment of certain facts, which, according to their Lordships, could have been established by adducing any reliable evidence. In the case of Kedarnath Jute Manufacturing Co. Ltd. [1965] 16 STC 607 (SC), the question involved was one relating to grant of exemption which was based on a condition prescribed under the Act itself. It was not a case of interpreting a subordinate legislation setting out a condition, which if held mandatory, could have conflicted with the scheme and the provisions of the Act itself. In the present case, it is beyond any shadow of doubt that under section 5 of the Act the special sales tax can be levied only at one point. The Legislature has fixed that to be the last point of sale in the series of transaction of goods but has also conferred a discretion on the State Government to alter that point "subject to such conditions and restrictions as it may impose". Therefore, on a plain construction, if the conditions and restrictions attached with the altered point of levy are not satisfied, the consequences would be that the point of levy will revert back to one which has been fixed by the Legislature but this is not the situation. The notification issued by the State Government under the proviso to section 5 has altered the point of levy to first point without subjecting it to any conditions and restrictions. But in the last column of the Schedule to the notification it has sought to provide certain conditions for grant of exemption at the subsequent stage. As discussed above, the conditions are wholly immaterial for determining the point of levy and, therefore, the conditions so laid down can be conveniently read as directory because such a reading will not in any way adversely affect the interest of the revenue and what is more important is that this course will make the provisions under the notification consistent with the provisions under section 5 of the Act. In all such cases the dealer is required to satisfy the assessing officer that he has purchased the goods from a registered dealer who is liable to pay tax under the Act, which has been duly done in the present case. I may incidentally indicate here that one of the dependable modes for ascertaining the said fact can be as to whether the payment to the selling dealer has been made by crossed cheque or crossed bank draft as mandatorily required under section 40A(3) of the Income-tax Act, 1961. The word "expenditure" under the said section includes price paid for purchases of stock-in-trade as held even by this Court in the case of Commissioner of Income-tax v. Ram Chand Gobind Prasad reported in [1985] 156 ITR 766. For the reasons aforesaid the question No. 1 is answered in negative, i.e., against the department. As discussed above, question No. 2, as framed, need not be answered. No costs. Let a copy of this judgment be sent to the Commercial Taxes Tribunal, Bihar, Patna, for needful.