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2017 (7) TMI 667 - PUNJAB AND HARYANA HIGH COURTLevy of turnover tax - inter state sale - PVAT Ac, 2005 - whether the petitioner had traded in goods as defined under the PVAT Act? - Held that: - There is no dispute that the articles dealt with by the petitioner fall within the meaning of the word “goods” as defined in section 2(k) of the PVAT Act - the ETO proceeded almost entirely, on the basis that the goods were brought into the State of Punjab through the ICC and that in Form VAT-36 the petitioner mentioned its TIN. This fact, according to the ETO, established that the petitioner had imported the goods to Punjab without anything more and sold the same only thereafter to various customers. Thus, according to the ETO, the petitioner sold the goods in the State of Punjab and that the sales were not inter-state sales as contended by the petitioner. This, in our view, was a fundamental error. Whether the logistics partner is a trader? - Held that: - The WS Retail Services Private Limited, the logistics provider is a registered taxable person under the Punjab VAT Act, 2005 holding TIN 03392097512. The taxable person has imported the goods on its TIN. The taxable person does not have any physical stock or stock in the books of such imports made. Further, it has exported goods in the course of interstate trade and commerce. Thus, the taxable person is a legitimate trader - For continuously three years the goods were being imported into the State of Punjab on the Tax Identification Number (TIN). The dealer has no stock of the goods with him in his books. Hence, it is very clear that all the goods have been sold in the State of Punjab on which the dealer is liable to pay tax. Whether the taxable person be taxed? - Held that: - The data of the Department clearly shows that the taxable person has imported the goods on its TIN. If the goods have been imported by the taxable person, then it would have disposed off also by the taxable person. It is the taxable person who has dispatched the taxable goods to the end consumer. The consumer is in the State of Punjab. Most of the transactions made by the end users are on the basis of cash on delivery. The taxable person has also received the consideration for the goods sold to the end user - the transaction is a legitimate sale by the taxable person within the State of Punjab and hence, the person is liable to be taxed. Whether the sale occurred within the State of Punjab? - Held that: - In this case, it is clear that the goods were imported by the taxable person to sell in the State of Punjab. Hence, all the Sales except clearly mentioned as exports as per ICC data have occurred within the State of Punjab. Where does the property in the goods transferred (sic transfer) to the buyer? - Held that: - The assessment order has not considered any of the principles discussed elaborately in the above authorities. We will assume that the authorities were not brought to the notice of the ETO. The assessment order has proceeded on a basis which is contrary to these principles. We hasten to add that as stated in the assessment order it is also possible that the entire material was not produced before the ETO. Upon remand, it would be necessary for the Assessing Officer to consider the material in the light of the above principles and authorities. Isn’t the e-commerce website a virtual showroom? - Held that: - It matters not where the sale was ultimately concluded while determining whether it is an inter-state sale or not. Even assuming that the sale was finally concluded in the State of Punjab, so long as the sale caused the movement of goods from another State to the State of Punjab, it would be an inter-state sale. If the petitioner’s case, which we have already referred to in some detail, is correct the sales effected by it would constitute inter-state sales and fall within the ambit of the Central Sales Tax, 1956. If the dealer has acted as a logistics partner, then can we tax him? - Held that: - The question has not been answered. The assessment order does not hold the petitioner liable for tax in respect of the sales by other vendors to purchasers in respect whereof it rendered services as a logistic provider. As a logistic provider the petitioner only facilitated the transport and delivery of goods by the vendors to the purchasers. It did not have any proprietary interest in these goods - if the transactions are as suggested by the petitioner and as set out in detail by us earlier, the sales would be in the course of inter-state trade and commerce. It is for the petitioner to establish the same. If on the other hand the goods were first imported into the State of Punjab without anything more and the petitioner entered into the transactions of sale with its purchasers thereafter they would not constitute sales in the course of inter-state trade and commerce. Further, where it is established that the petitioner acted only as a logistic provider, the petitioner would not be liable under the VAT Act - It would be necessary for the ETO to consider the transactions afresh. The ETO must in other words assess the documents already furnished and the documents that may hereafter be furnished. The impugned assessment order and the demand notices issued pursuant thereto are quashed and set-aside - The matter is remanded to the ETO for passing a fresh assessment order in accordance with law - petition allowed by way of remand.
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