State's Authority Upheld to Tax Inter-State Sales Without "C" Forms

The revision petition was dismissed as the State of Rajasthan had the authority to levy tax on the subsequent inter-State sale without "C" forms. The judgment affirmed the applicability of the proviso to section 9(1) of the Central Sales Tax Act and upheld the decision of the Sales Tax Tribunal, which held the transaction liable to tax based on a retrospective amendment clarifying tax collection jurisdiction in such cases.

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Issues:
1. Jurisdiction of State of Rajasthan to levy tax on subsequent inter-State sale without "C" forms.
2. Applicability of proviso to section 9(1) of the Central Sales Tax Act.
3. Interpretation of section 9(1) and its proviso in the context of retrospective amendment.
4. Authority of State of Rajasthan to collect tax on subsequent inter-State sale.

Analysis:
The judgment pertains to a revision filed under the Rajasthan Sales Tax Act, 1954, and the Central Sales Tax Act, 1956, concerning a dispute related to the sale of goods amounting to Rs. 5,65,080 for the period June 1965 to March 1966. The primary issue raised was whether the State of Rajasthan had the jurisdiction to collect tax on a subsequent inter-State sale where the "C" forms were not issued or utilized. The revision raised questions regarding the interpretation of section 9(1) of the Central Sales Tax Act and the liability of the assessee under the proviso to section 9(1.

The assessing authority had levied tax on the sale of iron and steel at 2%, which was challenged by the assessee. The dispute arose as the "C" forms were not issued for the inter-State sale. The Tribunal reversed the decision of the Deputy Commissioner (Appeals) and held the transaction liable to tax. The Tribunal's decision was based on the retrospective amendment made by the Central Sales Tax Amendment Act 28 of 1969, which clarified the jurisdiction for tax collection in cases where "C" forms were not utilized or obtained.

The judgment highlighted the significance of the proviso to section 9(1) of the Central Sales Tax Act, which empowers the State of Rajasthan to collect tax on subsequent inter-State sales even in the absence of "C" forms. The Tribunal correctly concluded that the State of Rajasthan had the jurisdiction to levy tax on the inter-State sale in question, as the necessary declaration forms were not submitted by the assessee.

The judgment emphasized the retrospective effect of the amendment and the intention behind inserting the clause "or as the case may be could have obtained" to avoid disputes regarding tax jurisdiction in cases where "C" forms were not procured. It clarified that even without the submission of "C" forms, the State of Rajasthan, as an agent of the Government of India, could collect tax on subsequent inter-State sales.

In conclusion, the revision petition was dismissed as the State of Rajasthan was deemed to have the authority to levy tax on the subsequent inter-State sale in the absence of "C" forms. The judgment reaffirmed the applicability of the proviso to section 9(1) and upheld the decision of the Sales Tax Tribunal regarding the tax liability of the assessee.

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