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2010 (4) TMI 1002 - HC - VAT and Sales TaxWhether, in the facts and circumstances of the case, the Tribunal was correct in law in holding that the appellant was liable to pay VAT in respect of goods transferred by it to its agent on consignment basis? Held that:- The Tribunal, in the facts and circumstances of the case, was not correct in law in holding that the appellant was liable to pay VAT in respect of goods transferred by it to its agent on consignment basis. The impugned order is, therefore, set aside. Notification No. F.4(3)/P-II/VAT/2005/1158 dated December 2, 2005 issued by the Commissioner, Value Added Tax to the extent it requires payment of value added tax on the supplies made by a principal to a consignment agent, even if such supply is not coupled with transfer of property in the goods to the consignment agent and the transaction between the parties otherwise does not amount to "sale" in terms of the provisions of the Delhi Value Added Tax Act, 2004, is quashed. The demand notices impugned in the writ petition are hereby quashed. It will, however, be open to the Department to examine the nature of the transactions between the petitioner-company and its consignment agents in the light of the observations made in this judgment and thereafter proceed in accordance with law if it comes to the conclusion that the transactions between them constitute "sale" within the meaning of the Delhi Value Added Tax Act, 2004.
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