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of <h1>Court affirms tax liability for inter-State sales of photography goods under Central Sales Tax Act</h1> The Court dismissed the appeal, affirming the tax liability on the appellant for sales of photography goods as inter-State sales under the Central Sales ... - Issues:1. Whether the sales of photography goods by the appellant/assessee to local purchasers for the assessment year 1976-77, based on actual users import license, are exempt from sales tax under the Central Sales Tax Act, 1956, as sales in the course of import into India.Analysis:Issue 1:The appellant, a dealer in photography goods, imported goods based on actual users license and sold them to local buyers. The assessing officer rejected tax exemption, stating no privity of contract between local buyer and foreign seller. The Appellate Assistant Commissioner allowed the appeal, considering the appellant as an agent of the local buyer. However, the Joint Commissioner revised the decision, stating no evidence of agency and upheld tax liability. The Court analyzed the conditions for sales in the course of import under Section 5(2) of the CST Act.Analysis Continued:The Court referred to the Supreme Court's criteria for sales in the course of import, emphasizing the essential conditions: sale, actual import, and sale occasioning import. It highlighted the need for an integral connection between sale and import for exemption under Section 5(2). Rulings in previous cases were examined to determine the necessity of a contractual link between the foreign seller and local buyer for sales to qualify as in the course of import.Analysis Continued:The Court found the appellant failed to establish a connection between the first sale post-import and the import itself, crucial for claiming exemption. The absence of terms prohibiting diversion post-import weakened the appellant's case. Distinctions were made from previous cases where such integral links were evident, leading to sales being considered inter-State and taxable. The Court upheld the Joint Commissioner's decision, dismissing the appeal against tax liability under the CST Act.Conclusion:The Court dismissed the appeal, affirming the tax liability on the appellant for sales of photography goods as inter-State sales under the Central Sales Tax Act.
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