TMI Blog2016 (9) TMI 611X X X X Extracts X X X X X X X X Extracts X X X X ..... ehicle for all practical purposes or is viewed as the person in charge of the vehicle, the liability of tax and penalty foisted upon the assessee is unjustified and cannot be sustained. Revision set aside - decided in favor of assessee. - Sales/Trade Tax Revision No. – 557, 558 of 2011 - - - Dated:- 2-9-2016 - Hon'ble Yashwant Varma, J. For the Applicant :- Krishna Agrawal For the Opposite Party : C.S.C. ORDER Hon'ble Yashwant Varma, J. Heard Sri Krishna Agrawal, learned counsel for the revisionist and Sri B.K. Pandey, learned Standing Counsel. These two revisions having arisen from proceedings taken by the respondent authorities in respect of a singular transaction, have with the consent of parties been taken up for disposal together. The facts upon which there is not much dispute are as follows: The revisionist is a company having its registered office in Mumbai in the State of Maharashtra. It is engaged in the business of manufacture and sale of motor vehicles, chassis and other parts. For the purposes of effecting sales of the articles manufactured by it, it establishes regional sales offices in various States throughout the country. Du ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on appended to Section 28-B is deemed to be the owner of the vehicle. Referring then to the fact as noted in the orders impugned, Sri Agarwal submitted that undisputedly Naseem Ahmad appears to have sold the vehicle to one Ali Mohammad after it had crossed into the State of U.P. He submits that neither the actions taken by Sri Naseem Ahmad post the delivery and sale of the vehicle or the infraction of registration laws by him could by any stretch of imagination be said to attach a liability of tax upon the revisionist. Sri Pandey, learned Standing Counsel while countering the above submissions has contended that a hire purchase agreement by its very nature does not result in a sale or a transfer of property in goods. He, therefore, submits that the revisionist continued to be the owner of the vehicle and was consequently correctly held liable to be proceeded against for violation of the provisions of Section 28-B. He further referred to the fact that the hire purchase agreement itself was one which was executed between the revisionist and Naseem Ahmad and therefore submitted that the revisionist was the owner who admittedly failed to comply with the provisions of Section 28-B. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an obligation upon the driver or other person in charge of a vehicle to obtain a transit pass at the first check-post barrier after entry into the State of U.P. and surrender the same to the officer in charge of the last check-post or barrier before exiting the State of U.P. The provision itself stands attracted to cases where goods coming from any place outside the State are transiting through the State and are bound for a place outside U.P. The section then also engrafts a presumption against the driver or other person-in-charge of the vehicle to the effect that if the transit pass is not surrendered at the last check post or barrier, it shall be presumed that the goods have been sold within the State by the owner or person-in-charge of the vehicle. While the obligation to obtain a transit pass is placed upon the driver or other person-in-charge of the vehicle, it becomes apposite to note that the presumption of sale stands raised against the owner or the person in charge of the vehicle. The Explanation appended to the provision provides that in a case where the vehicle in question is hired for transportation of goods, the hirer of the vehicle shall for the purposes of the provi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... He may establish that the goods have been delivered to some other person under a transaction which is not a sale, they have been consumed inside the State or have been re despatched outside the State without effecting a sale within the State etc. It is only where the presumption is not successfully rebutted the authorities concerned are required to rely upon the rule of presumption in Section 28-B of the Act. It is, therefore, not correct to say that a transaction which is proved to be not a sale is being subjected to sales tax. The authority concerned before levying sales tax arrives at the conclusion by a judicial process that the goods have been sold inside the State and in doing so relies upon the statutory rule of presumption contained in Section 28-B of the Act which may be rebutted by the person against whom action is taken under Section 28-B of the Act. When once a finding is recorded that a person has sold the goods which he had brought inside the State, then he would be a dealer even according to the definition of the word 'dealer' as it stood from the very commencement of the Act subject to the other conditions prescribed in this behalf being fulfilled. A person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of sale unless the contrary is proved. That the goods are produced within the market area is not in dispute in the instant case. That they left the market area is also admitted. In the ordinary course, therefore, the presumption would be that the goods left pursuant to a sale unless the appellants are in a position to prove the contrary. 58. The second reason for applying a higher standard of proof than mere preponderance of probability is that the nature of transaction pursuant to which the goods are removed from the market area is within the exclusive knowledge of the appellants or the persons to whom such goods are being dispatched. In other words, the circumstances in which the transactions, which the statute presumes to be sales, but which the appellants claim are simple transfer of stocks are within the exclusive knowledge of the appellants. The entire evidence relevant to the transactions, being available only with the appellants and the true nature of the transactions being within their special knowledge, there is no reason why the rebuttal evidence should not satisfy the higher standard of proof and clearly and convincingly establish that the fact presumed is not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had before them not just the invoices of sale executed by the revisionist in favour of Motor and General Sales Limited but also the delivery and sale invoice executed in favour of Naseem Ahmad. These documents evidenced a sale by way of hire purchase outside the State of U.P. The documents and evidences so led clearly tended to dislodge the rebuttable presumption raised. Whether the test of tending to show is applied or the test of preponderance of probability , it is apparent that the presumption raised against the revisionist stood clearly discharged. In the opinion of this Court the evidence led before the respondents was clear and convincing and worthy of being placed in the category of evidence which fairly and reasonably showed that the real fact was not as presumed. It becomes pertinent to note here that the department does not rely upon or rest its case against the revisionist upon any other independent material or evidence. Additionally, this Court finds merit in the submission of Sri Agarwal who relying upon the principles enunciated by the Supreme Court in Asea Brown Boveri submitted that the owner of the vehicle was for all practical purposes Naseem Ahmad and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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