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2019 (2) TMI 128 - AT - VAT and Sales TaxClassification of supply - stock transfer or inter-state sale? - issuance of Form ‘VI-B’ / Form F under the CST Act - case of the Revenue is that the business audit conducted at the appellant’s business premises between 06.05.2008 to 08.05.2008 disclosed facts adverse to the appellant - Held that:- It is clear from the show cause notice that it is based on goods sold to M/s Omni Auto Ltd. in March 2008. It is clearly stated that all the goods dispatched to the branch during this period have been sold to only one purchaser namely, M/s Omni Auto Ltd. The show cause notice clearly mentions that on the basis of material submitted by the appellant it can be inferred that the dispatches are as per the pre-existing order received from M/s Omni Auto Ltd. When the show cause notice is based entirely on the sale to one purchaser namely, M/s Omni Auto Ltd. it is not understood why the reasons given in the assessment order do not even mention M/s Omni Auto Ltd. The assessment order is blissfully silent about any sales to M/s Omni Auto Ltd. No doubt, it is the case of the Revenue that the appellant was asked to produce the purchase order for the year 2007-08, but the appellant did not produce any purchase order. The appellant should have produced purchase orders if they were in existence. But for that reason the Assessing Authority could not have used purchase order of Tata Steel to come to a conclusion that the branch transfer claim made by the appellant deserves to be rejected - Without even referring to M/s Omni Auto Ltd., the Assessing Authority has stated that it has considered the dispatch proof, consignment notes, F forms etc. produced by the appellant and after verification it has come to the conclusion that in spite of production of F forms, the claim of branch transfer is not allowable. Whether all this material was with respect to transactions with M/s Omni Auto Ltd. is not clear, because there is no reference to M/s Omni Auto Ltd.. It was necessary for the Assessing Authority to first lay a firm foundation by specifically referring to individual transactions with M/s Omni Auto Ltd. since the purchase orders were not before it. As already noted in Tata Engineering and Locomotive Co. Ltd. the Supreme Court has stressed the need to examine individual transaction while deciding whether it constitutes inter-State sale. This is more so here because there is no purchase order as was before the Assessing Authority when it passed assessment order for the year 2006-07. It is necessary to mention that the appellant’s Counsel has contended that in any case during the year 2007-08, the appellant has sold goods worth ₹ 23,87,389/- to Tata Steel. Assuming that reliance placed on purchase order of Tata Steel is right, the disallowance could only be to the extent of ₹ 23,87,389/- and not the entire claim of ₹ 32,24,63,898/for which there is no purchase order. This contention needs to be looked into - the matter needs to be remanded to the Assessing Authority with a direction to pass a fresh assessment order independently and in accordance with law after giving opportunity to the appellant to place its case before the Assessing Authority. Appeal allowed by way of remand.
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