Stock transfer exemption fails when Form F is inconsistent with invoices and false particulars support penalty.

Stock transfer exemption under section 6A of the Central Sales Tax Act requires the dealer to prove that goods moved otherwise than by reason of sale, typically through Form F and supporting despatch evidence. Where the declaration is inconsistent with invoices, lacks movement particulars, or contains false particulars, the claim may fail and the turnover may be treated as an inter-State sale. A false or untrue Form F can also justify penalty, especially where the exemption claim is founded on deliberate misstatement and discretionary relief is sought without equity.

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Issues: (i) Whether the disputed turnover was proved to be a stock transfer exempt under section 6A of the Central Sales Tax Act, 1956, or an inter-State sale. (ii) Whether penalty imposed for the transaction was sustainable.

Issue (i): Whether the disputed turnover was proved to be a stock transfer exempt under section 6A of the Central Sales Tax Act, 1956, or an inter-State sale.

Analysis: The burden lay on the dealer to establish that the movement of goods was otherwise than by reason of sale. That burden could be discharged by Form F and supporting despatch evidence. The Form F produced before the Tribunal did not match the invoices: the form reflected semifinished goods, while the invoices showed finished goods. The form also lacked necessary movement details. In view of these discrepancies and the false particulars in the declaration, the finding that the transaction was not a genuine stock transfer called for no interference.

Conclusion: The claim for exemption as stock transfer failed, and the turnover was rightly treated as taxable inter-State sale.

Issue (ii): Whether penalty imposed for the transaction was sustainable.

Analysis: Penalty was imposed because the assessee claimed exemption by filing a false Form F declaration and representing an untrue stock transfer. A party invoking writ jurisdiction must approach the Court with equity, and a claimant who lacks equity cannot seek discretionary relief against a penalty founded on deliberate misstatement.

Conclusion: The penalty was sustained.

Final Conclusion: The writ petitions failed on merits because the stock transfer claim was not established and the penal consequence flowing from the false declaration was upheld.

Ratio Decidendi: A dealer claiming exemption for stock transfer must strictly prove that the movement of goods was not occasioned by sale, and a false or inconsistent Form F declaration justifies treating the transaction as taxable and sustaining penalty.

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