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TMI Blog2015 (1) TMI 591X X X X Extracts X X X X X X X X Extracts X X X X ..... preferred by the Assessee to challenge the order dated 28th April, 2000 passed by the Deputy Commissioner of Sales Tax (Appeals) IV, Mumbai City Division, Mumbai. The period in question is from 1st April, 1996 to 31st March, 1997. 3. The Assessee is the registered dealer both under the Bombay Sales Tax Act, 1959 and the Central Sales Tax Act, 1956 (for short "the BST" and "the CST"). The Assessee carrying on the business of making scented supari. The process of decorticating, colouring, scenting etc. of Betel nuts does not amount to manufacture in view of Rule 3 of the Bombay Sales Tax Rules, 1959. The Assessee was assessed by the Assistant Commissioner of Sales Tax (Assessment) for this period. As the turnover of the Assessee for the previous year was more than Rs. 50 lacs, the Assessee claimed that it was eligible for a set off under Rule 42H of the Bombay Sales Tax Rules, 1959. The Assessing Officer did not grant this set off. Therefore, an Appeal was preferred against this order before the Deputy Commissioner of Sales Tax. That Appeal also failed. That is how the Second Appeal was filed before the Tribunal. 4. The Assessee argued before the Tribunal that the set off under Ru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her brought to our notice an order passed by the Tribunal on 11th February, 2005 in the matter of M/s. Sriniwas Chemicals Industries Pvt. Ltd. vs. State of Maharashtra Second Appeal No. 1794 of 2002. 8. On the other hand, Mr. Sonpal, the learned Counsel appearing for the Respondent submits that the Tribunal's conclusion cannot be said to be vitiated by any error of law apparent on the face of STR.17.2006.6.doc record or perversity. Mr. Sonpal submits that primarily the Revenue has to be satisfied that the sales of the Assessee like the present one, should not be out of the purview of or beyond the reach of the BST. In the present case, sales were beyond the BST. If that is so, then there is no question of the further stipulations under Rule 42-H being satisfied. There was no case of any disallowance under Section 8 of the BST. Considering the transactions and the sales, the Tribunal was right in upholding the disallowance. For all these reasons, he submits that, this reference be answered in favour of the Revenue and against the Assessee. Mr. Sonpal submits that there is no question of a letter addressed to M/s. K. Mahendrakumar and Company on 17th September, 1999 being constr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in respect of which the deduction from turnover of sales has not been allowed under subsection (1) of section 8 because of the provision contained in subsection (3) or, as the case may be, in subsection (3A) of section 12A the Commissioner shall, subject to the provisions of sub-rule (2), grant him drawback, set-off or, as the case may be, a refund of aggregate of the sums determined in accordance with the provisions of rule 44-D in respect of purchase of such goods including the goods used for packing of such goods. Provided that, drawback, set off or, as the case may be, refund under this rule shall not exceed the tax payable on the sale of such goods, not being sales against any declaration or certificate prescribed under the Act, Rules or as the case may be, any entry of Schedule to the notification issued under section 41: Provided further that, if the dealer effects any sales by way of a delivery of goods as hirepurchase of any system of payment by instalments, then the amount of drawback, setoff, or as the case may be, refund under this rule shall be in proportion to the purchase price of that instalment. (1A) Notwithstanding anything contained in subrule (1), the amount o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erritory of India. Rule 21A of the Bombay Sales Tax Rules reads as under: "21A. Form of Certificate to be furnished by dealer in support of his claim for exemption in respect of sales deemed to be in the course of export out of the territory of India-. A dealer may in support of his claim that he is not liable to pay tax under the Act in respect of the sale of goods on the ground that the sale of such goods is a sale in the course of export of the goods out of the territory of India within the meaning of subsection (3) of section 5 of the Central Sales Tax Act, 1956 (LXXIV of 1956) produce before the Commissioner a certificate in Form N14B duly filled in and signed by the exporter to whom the goods are sold, along with the evidence of export of such goods." 13. A bare perusal of this Rule would indicate that a dealer may make a claim that he is not liable to pay tax under the BST in respect of his sale of goods on the ground that the sale of such goods is a sale in the course of export of the goods out of the territory of India within the meaning of SubSection (3) of Section 5 of the CST. He can therefore produce a certificate in the Form referred by us above along with evidence ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of this section whether a sale or purchase takes place Page (i) outside the State, or (ii) in the course of the import of the goods into the territory of India or export of the goods out of such territory, or (iii) in the course of interState trade or commerce, shall be determined in accordance with the principles specified in section 3, 4 and 5 of the Central Sales Tax Act, 1956." 15. Therefore, the sales and purchases which are not liable to tax under the BST by virtue of Section 75 have been rightly excluded or taken out of the purview of Rule 42-H and that is the only interpretation which can be placed on the said Rule. If one peruses Section 5 and particularly SubSection (1) and SubSection (3) of the CST together with Section 75 of the BST, Rule 21A of the Bombay Sales Tax Rules, Form N-14B harmoniously and together, it would be apparent that what is not within the purview of the BST can never be brought in for the purposes of claiming a deduction or set-off under Rule 42H. If that is the intent of legislature and it has been given effect to by the Tribunal in the impugned order, then we do not find that its conclusion is vitiated. 16. The absence of the explanation ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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