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2016 (9) TMI 827

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..... containing specified details. These details provided in items no.3 to 6 to the Schedule contain various information such as name of airport, seaport or land customs station through which the goods have been exported, name of airlines, ship etc. or other means of transport through which the export has taken place and such other relevant details. All these requirements would relate to actual export of goods sold by the assessee to the exporter. Only through such declarations would it be possible for the Assessing Authority to verify the claim of a dealer that the goods supplied were for the purpose of export and were actually exported by the purchaser-exporter. Mere declaration or assertion by the assessee would not be sufficient. Only upon satisfying such requirements contained in sub-section 4 of Section 5, the assessee would be covered by the deeming fiction provided under sub-section 3 of Section 5 and can claim the benefit of the export sale. When the revisional authority noticed discrepancies in the different documents supplied by the assessee, he was within his rights to deny the benefit of tax exemption to such extent. The penalty is discretionary and can be levied upt .....

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..... d of ₹ 1,98,761/-. 2.3 These orders gave rise to four separate revision petitions filed by the assessee before the Tribunal. The assessee challenged the additional tax demand for the said two years by filing two separate revision petitions. The assessee also filed two further revision petitions questioning the levy of penalty. In such proceedings before the Tribunal, the assessee contended that all necessary documents in support of the claim for exemption from demand of tax were produced. The Commissioner committed an error in rejecting the claim on some minor discrepancies noticed. Regarding the penalty, it was mainly contended that at the revisional stage, the penalty cannot be imposed for the first time. 2.4 The Tribunal allowed the revision petitions. The Tribunal was of the view that the sales made to the exporters cannot be identified bill to bill basis because the process of supplying such materials is ongoing and continuous. The revisional authority was not justified in demanding matching proof of documents. The manufacturer-exporters, in the opinion of the Tribunal, were particular in their business and the assessee would have to rely on them. No further proof .....

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..... ishes to the prescribed authority in the prescribed manner, a declaration filled and signed by the exporter to whom the goods are sold in a prescribed form obtained from the prescribed authority. Thus, for applicability of sub-section 3 of Section 5, the seller has to fulfill the requirements of sub-section 4, failing which the provisions of sub-section 3 would not apply. The requirements are thus prescribed to ensure the compliance requirements under sub-section 3 and further to ensure that the competent authority can verify the claim of the assessee of being a penultimate seller of the goods in course of export sale. 5. Sub-Rule 10 of Rule 12 of The Central Sales Act (Registration and Turnover Rules, 1957 (hereinafter to be referred to as `the said Rules of 1957') provides that the declaration referred to in sub-section 4 of Section 5 shall be in Form H and shall be furnished to the prescribed authority upto the time of assessment by the first Assessing Authority. Form H, under the said Rules of 1957, in turn refers to a certificate containing the following specifications: Certificate I Certified that the goods (the particulars whereof have been specified in terms ( .....

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..... overed by the deeming fiction provided under sub-section 3 of Section 5 and can claim the benefit of the export sale. The Tribunal, in our opinion, therefore, committed an error in treating such requirements as procedural or technical. When the revisional authority noticed discrepancies in the different documents supplied by the assessee, he was within his rights to deny the benefit of tax exemption to such extent. Under the circumstances, the revisional orders insofar as raising tax demand with interest is concerned, we hold that the Tribunal should not have interfered. 8. At this stage, counsel for the respondent, however, submitted that in any case even if the benefit of Section 5(3) of the CST Act is to be denied, the sales should be taxed as local sales and not as inter-state sales since the respondent had admittedly sold the goods to the Valsad exporter. We find merit in this contention. When there was no dispute about the sale of drums by the petitioner to the Valsad purchaser, in absence of further proof of the goods having been exported, the authority can at best tax them on the basis of local sales. The revisional authority has instead taxed such sales treating them as .....

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