9911796707
TMI Blog2012 (6) TMI 760X X X X Extracts X X X X X X X X Extracts X X X X ..... passed by the Commercial Tax Officer, Madhapur Circle, under the Central Sales Tax Act, 1956 ("the CST Act"). We will take the facts from W.P. No. 16662 of 2012, as the factual background in the other two matters is the same. The petitioner, M/s. HCL Technologies Limited, is an incorporated entity in the business of development and export of IT software. They are dealers under the Andhra Pradesh Value Added Tax Act, 2005, and the CST Act, on the rolls of the Commercial Tax Officer (CTO). For the assessment year 2008-2009, the petitioner filed returns under the CST Act disclosing the total direct export sales of Rs. 1,03,36,66,486. They claimed exemption on the export sales and concessional rate of tax at two per cent/three per cent on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o section 5, we may briefly indicate the position of taxes on exports and imports as contemplated under the Constitution. Exports and imports are taxable under the law made by the Parliament under article 246(1) of the Constitution read with entry 83 and all applicable entries of Union List (List I) in the Seventh Schedule to the Constitution. The State Legislature has no power to levy duties or taxes on exports and imports, although the State has power to impose taxes on sale or purchase of goods under entry 54 of the State List. But, article 286 restricts the State's power to impose tax on inter-State trade or commerce. This power is with the Union List. Under article 286(2), the Parliament is empowered to formulate principles for det ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods into the territory of India only if the sale or purchase either occasions such import or is effected by a transfer of documents of title to the goods before the goods have crossed the customs frontiers of India. (3) Notwithstanding anything contained in sub-section (1), the last sale or purchase of any goods preceding the sale or purchase occasioning the export of those goods out of the territory of India shall also be deemed to be in the course of such export, if such last sale or purchase took place after, and was for the purpose of complying with the agreement or order for or in relation to such export. A plain reading of the provision would show that if the sale of goods is by way of export out of territory of India, it is not e ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he CST Act, requiring to produce H forms which is relevant in the context of situation under section 5(3) would be unauthorised. Any assessment under such wrong premise would also be unauthorised by law. Be it reiterated that export sale is not in the course of inter-State trade or commerce and levy of tax thereon is unsustainable. In all matters, the CTO misdirected himself and passed the assessment orders. A misdirection in law is a jurisdictional error, and therefore, the impugned assessment orders cannot be sustained. They are liable to be set aside. In State of A.P v. Evershine Granites Ltd. [1987] 5 APSTJ 163 a Division Bench of this court dismissed a tax revision case, being TRC No. 92 of 1987, on June 8, 1987 affirming the order da ..... X X X X Extracts X X X X X X X X Extracts X X X X
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