TMI Blog2005 (1) TMI 637X X X X Extracts X X X X X X X X Extracts X X X X ..... .. The issues involved in all the three writ petitions are almost similar, hence, they are disposed of by this common order. 6.. The first respondent in W.P. No. 37702 of 2004 are dealers in wheat flour and atta flour. The first respondent was assessed on the total and taxable turnover of Rs. 2,44,90,328 and Rs. 65,57,439 respectively as against the reported total and taxable turnover of Rs. 2,49,57,187.40 and Rs. Nil respectively for the year 1993-1994 under the Central Sales Tax Act, 1956. The assessing officer in his proceedings dated October 27, 1997 disallowed the claim of exemption on Rs. 65,47,439 as consignment sales and brought to tax as outright inter-State sales assessable to tax at 8 per cent and also levied penalty of Rs. 9,83,616 under section 9(2A) of the CST Act, 1956 read with section 12(3)(b) of the TNGST Act, 1959. Aggrieved by the order of assessment, the first respondent herein preferred an appeal in AP CST No. 33 of 1998 to the Appellate Assistant Commissioner (CT), Pollachi, who by an order dated March 3, 2000 allowed the appeal in respect of disallowance of consignment sales. A second appeal was filed by the State against the order of Appellate Assistant C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Amendment Act 42 of 1992, the words "High Court" found under section 38 of the TNGST Act was substituted by the words "Special Tribunal" and all matters arising under TNGST Act is now dealt with by Tamil Nadu Taxation Special Tribunal constituted for the purpose under the Tamil Nadu Taxation Special Tribunal Act, 1992 and the Special Tribunal is vested with the jurisdiction to deal with the matters arising under the Act as enumerated in the Schedule to the said Act. In respect of matters arising under the Central Sales Tax Act, division Bench of this Court in its order in TC Nos. 129 and 130 of 1996 dated April 8, 1999 held that on and from December 22, 1995, the power to hear tax revision and appeal was no longer available and dismissed the tax revision. Another division Bench of this Court held that the Tamil Nadu Taxation Special Tribunal has no jurisdiction to hear the matters arising under the Central Sales Tax Act, hence, the petitioner is left with no other alternative remedy except to approach this Court under article 226 of the Constitution of India. In view of the same that the Special Tribunal is not functioning, the matters relating to Central Sales Tax Act can be heard ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s can be said to take place in the course of interState trade or commerce. Section 6 lays down the liability to tax. Section 6-A has been inserted for the purpose of providing that the burden of proving any movement of goods from one State to another was occasioned otherwise than as a result of sale would be on the dealer making such claim. Section 8 deals with rate of tax on goods sold in the course of inter-State sale. Section 9 provides for the levy and collection of tax and penalty. 13.. The question for consideration is whether the goods, which are transported to other State to their agent can be taken into consideration for inter-State trade. 14.. It is open to the dealer to prove whether a sale or purchase of goods has taken place in the course of inter-State trade or commerce by any other evidence, but once the dealer chooses to file a declaration in form F, the burden would be upon him to show that the particulars mentioned in form F are true. If he fails to establish that the particulars mentioned in form F are true, it would be open to the assessing authority to record a finding that there is no material to show that the transfer of goods is otherwise than by way o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses of the Act and such transfer shall have to be deemed to be a sale of goods in the course of inter-State trade or commerce for the purposes of the CST Act. On the contrary, if the authority accepts that the particulars contained in the declaration filed in form F are true, the dealer is discharged of his burden and the authority has to make an order accepting the declaration and the effect of such an order would be that the movement of goods to which the declaration relates shall be deemed for the purposes of the CST Act to have been occasioned otherwise than as a result of sale..........." 15. Under sub-section (1) of section 6-A of the Central Sales Tax Act and form F prescribed in sub-rule (5) and the first proviso thereto of rule 12, it is contemplated that there is no need or necessity at all for the agency to be always evidenced by a document in writing. The said view is taken in the decision reported in State of Tamil Nadu v. Cocoa Products and Beverages Limited [1998] 109 STC 634 (Mad.), wherein it was held in para 21 thus: "21. No doubt, as we have earlier indicated, they got themselves registered as 'registered dealers' under the CSTA at Bombay, only with effect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In that case, the Supreme Court has pointed out that the true relationship of the parties in each case has to be gathered from the nature of the contract, its terms and conditions and the terminology used by the parties is not decisive of the legal relationship. As already pointed out, the agreement entered into between the parties clearly shows that the Civil Supplies Corporations in Andhra Pradesh and Kerala are constituted only as agents and they cannot be taken to be buyers of the goods for a price. The terms of the agreement make it clear that the goods are delivered by the State Trading Corporation to the Civil Supplies Corporations only in their capacity as distribution agents and there is no sale as between them. In this view of the matter, we do not think that any interference is called for in the orders of the Tribunal." 17.. A sale can be said to be in the course of inter-State trade only if two conditions are fulfilled namely, (i) a sale of goods and (2) transport of those goods from one State to another. Unless both these conditions were satisfied, there could be no sale in the course of inter-State trade. There must be evidence that the transportation was occasione ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... F is not produced. The Tribunal has rightly appreciated the arguments advanced by the assessee that once the specific proof prescribed under section 6A of the CST Act by way of form F with sales pattials and proof of despatch of goods, form XX and that discharged the burden of proof, the claim under section 6A can be disallowed only after rejecting form F, that too for the reasons to be recorded in writing. 22.. Under section 9(2-A) of the CST Act read with section 12(3)(b) of the TNGST Act, penalty is leviable. Penalty could be levied only in case where the assessment is a best judgment assessment made on an estimate and not by relying solely on the accounts furnished by the assessee in the prescribed return. Section 12(3), Explanation requires the turnover relating to the tax assessed on the basis of the accounts of the assessee, to be disregarded while determining the turnover on which penalty is to be levied under section 12(3). The bona fides of the person, who is alleged to have withheld the tax is also a factor which the assessing authority must consider even in cases where the tax is found to have been withheld. Followed (Appollo Saline Pharmaceuticals (P.) Ltd. v. Commer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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