TMI Blog2014 (12) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... where the apex court enunciated the law regarding inter-State sale by way of the covenant, we are of the opinion that the covenant under reference in the writ petition does not accommodate any provision for inter-State sale and as such prima facie it cannot be held simply for making the payment of full value in advance that an inter-State sale has commenced before the movement of the goods/products from the State of Assam to the State of Tripura. If it appears to the Revenue in the State of Tripura that it is a foul mechanism designed by the principal and the writ petitioner to evade tax in any manner, they are not under any disability to make reference to the assessing authority as defined under section 6A(2) of the CST Act, 1956 for making necessary inquiry and to take final view on the nature of transaction. But, at no event the Revenue-appellants are authorised by law to refuse form F to the writ petitioner. - W.A. No. 37 of 2011 - - - Dated:- 30-5-2012 - GOEL A.K. C.J. AND TALAPATRA S., J. For the Appellants : B.B. Das For the Respondents : B.N. Majumder and P. K. Biswas The judgment of the court was delivered by S. TALAPATRA J. This intra-court appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -inopposition as filed by the Revenue in the Misc. application, which was adopted by the Revenue in the writ petition as their reply, some premises for the impugned action can be located. For appreciation, para No. 6.5 of the said affidavit-in-opposition is reproduced hereunder: 6.5. That it reveals from the clause No 1 of the agreement made between the petitioner and outside State dealer (as per annexure P/1, page 15-16 of the writ petition and office records) clearly show that this agreement is made to evade taxes due under the CST Act, 1956 against the inter-State sale and to evade taxes under TVAT Act, 2004. Clause 1 read thus 'Order will be delivered f.o.r., Agartala on receipt of the full value in advance and F forms', which indicates that this agreement is nothing but to evade the payment of due tax under the CST Act, 1956 against the inter-State sale and thereby, to evade the TVAT. It also reveals that earlier the petitioner obtained form F by submitting false declaration. From the reading of the agreement it is clear that the petitioner and the so-called principal entered into agreement to sell and buy goods with money consideration. As per this agreement the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1. You will send full payment as advance by demand draft and one blank F form against your order. 2. We will dispatch the goods through our preferable transport after receipt of full payment in advance only. 3. You will sell our products as per our invoice rate and charge us commission at five per cent on sale amount only. 4. You will send us F form, copy of sale bill for every month in the first week of the next month. 5. Any local taxes chargeable are liable by the sale agent who will collect and deposit to the local authority concern. 6. All the disputes, if arisen will be settled mutually by both the parties otherwise the matter will send to Guwahati Jurisdiction only. 7. We shall be terminate this agreement any time by giving one month notice to you. This agreement is valid for the period from April 1, 2009 to March 31, 2010. It is apparent that full payment of the product value as advance was required to be made by the writ petitioner to the principal along with a blank form F against the indent. It is stated in no uncertain terms that the goods would only be despatched by the transport preferable to the principal, after receipt of the full payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipura. As such the claim of inter-State transfer of stocks cannot legally sustain for the reasons that from the contents of the covenant it reveals that it was an incidence of the inter-State sale. Form F in appropriate cases are required only for exemption of the tax under the CST Act, 1956 in the said State, subject to inquiry and purpose of assessment of tax by the concerned authority under section 6A(2) of the CST Act, 1956. Mr. Das quite candidly acceded that form F used to be issued previously to the writ petitioner but that decision was reviewed by the competent authority and thereafter issuance of form F has been refused in accordance with law. In a nutshell, Mr. Das, learned counsel for the Revenue-appellant contended that the transaction in question is not by reason of transfer of goods as referred in section 6A(1) of the CST Act, 1956. Section 6A(1) and 6A(2) of the CST Act, 1956 are reproduced for reference: 6A. Burden of proof, etc., in case of transfer of goods claimed otherwise than by way of sale. (1) Where any dealer claims that he is not liable to pay tax under this Act, in respect of any goods, on the ground that the movement of such goods from one State to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , along with the evidence of despatch of such goods. In case of failure of making such declaration within the prescribed time then, the movement of such goods shall be deemed for all purpose of this Act to have been occasioned as a result of sale. It eminently transpires that whatever the burden to be discharged in respect of the nature of the movement of goods from one State to another State it has to be discharged by the registered dealer, who has occasioned such movement of goods from one State to another State claiming to be the inter-State transfer, not preceded by inter-State sale of any form and the assessing authority, in relation to that dealer is competent to inquire and assess the tax payable under the CST Act, 1956. Mr. B.N. Majumder, learned counsel appearing for the writ petitioner, while supporting the impugned judgment and order, submitted with emphasis that if the terms and conditions of the covenant in question is read, the plain meaning that would evince is that the products are being transferred from the State of Assam to the State of Tripura on payment of full value in advance and subject to furnishing form F. After the sale statement is furnished to the pri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of goods had occasioned not by reason of any transaction involving sale of goods but by reason of transfer of such goods to any other place of his business or to his agent or principal, as the case may be. For the purpose of discharge of such burden of proof, the dealer is required to furnish to the assessing authority within the prescribed time a declaration duly filled and signed by the principal officer of the other place of business or his agent or principal. Such declaration would contain the prescribed particulars in the prescribed form obtained from the prescribed authority. Along with such declaration, the dealer is required to furnish the evidence of such dispatch of goods by reason of Act 20 of 2002. In the event, if it fails to furnish such declaration, by reason of legal fiction, such movement of goods would be deemed for all purposes of the said Act to have occasioned as a result of sale. Such declaration indisputably is to be filed in form F. The said form is to be filled in triplicate. The prescribed authority of the transferee-State supplies the said form. The original of the said form is to be filed with the transferor State and the duplicate thereof is to be filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reading of the rule along with relevant provisions of the Act leads to the conclusion that rule 12A method, furnishing of certificate in the form and with the particulars is one of the methods of proving that sale by a registered dealer is not for consumption. Neither the rule nor the provision of the section suggests that this is the only method. If a dealer can prove by any way other than the way contemplated by rule 12A then he is not so precluded. For the rule to say otherwise would be exceeding the provision of the section. The purpose for the making of the rule would, however, be frustrated if after the dealer proves in the manner indicated in rule 12A he has to prove again how the purchasing dealer has dealt with the goods after he obtains the certificate from a registered dealer. That would make the working of the Act and rule unworkable. There is no dispute that in this case certificates as mentioned in rule 12A were furnished. The questions involved in this case are whether by furnishing certificate in form IIIA and the details of such certificate given in form IV, the selling dealer got exemption and rule 12A created an irrebuttable presumption, i.e., that no furth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he declaration related shall be deemed for the purpose of this Act to have been occasioned otherwise than as a result of sale'. 77. Each of them must be given its proper meaning. 78. A statute for the purpose of its interpretation must be read in its entirety. It is to be given a purposive construction. Applying Heydon's rule, it must be held that the amendment was necessitated not only to make the dealer to file such a declaration imperatively but also to see that such movement of goods becomes inter-State sale by raising a legal fiction, as 'having been occasioned in course of an inter-State sale'. In other words, if such a declaration is filed and on an inquiry made pursuant to or in furtherance of the particulars furnished are found to be correct by the assessing authority, the result thereof which is evidenced by the expression 'thereupon' shall in view of the legal fiction created would be a transaction otherwise than as a result of an inter-State sale. Furthermore, once such a legal fiction is drawn, the same would continue to have its effect not only while making an order of assessment in terms of the State Act but also for the purpose of invok ..... X X X X Extracts X X X X X X X X Extracts X X X X
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