1984 (7) TMI 350 - HC - VAT and Sales Tax

Court affirms Tribunal's tax exemption on disputed turnovers, citing import nexus and legal precedents.

State of Tamil Nadu Versus National Cash Register Co.

The High Court affirmed the Tribunal's decision to exempt disputed turnovers from tax, considering them as sales in the course of import. Relying on ... - Issues:1. Disputed turnover claimed as exempt from tax representing sales in the course of import.2. Appellate authority's denial of exemption.3. Tribunal's decision based on import licenses and letters of authority.4. Tribunal's reliance on previous judgments.5. Applicability of Supreme Court and High Court decisions.6. Confirmation and dismissal of tax revision cases.Analysis:1. The case involved two tax revision cases where the assessees claimed exemption on disputed turnovers, contending they represented sales in the course of import. The assessing authority disallowed the claim, treating them as local sales instead of import sales.2. The Appellate Assistant Commissioner upheld the denial of exemption. However, the Tribunal, after verifying records, found that the assessees acted as agents for buyers who held import licenses and letters of authority for importing goods. The Tribunal established a clear nexus between manufacturer, import, and sale.3. The Tribunal's decision was based on the Supreme Court ruling in Deputy Commissioner of Agricultural Income-tax and Sales Tax v. Kotak and Company [1973] 32 STC 6, and its own earlier judgments. The Tribunal concluded that the turnovers were exempt from tax as they represented sales in the course of import.4. The High Court referred to its own decision in State of Tamil Nadu v. I.B.M. World Trade Corporation [1985] 60 STC 118, where a similar situation was upheld, supporting the Tribunal's view. The Court found the facts in the present case identical to those in the previous judgment.5. Considering the precedents set by the Supreme Court and the High Court, the Court affirmed the Tribunal's decision and dismissed the tax revision cases. The Court emphasized the one-sale principle, where the assessees acted as agents for the actual users in facilitating the import sales.6. In conclusion, the High Court dismissed the petitions, upholding the Tribunal's decision based on the one-sale principle and the established nexus between the assessees, buyers, and foreign sellers in the import transactions.