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Issues: (i) whether the movement of goods from West Bengal to Assam for execution of the contract was an inter-State sale or a stock transfer, and (ii) whether the statutory requirements for carrying documents under section 81 of the West Bengal Value Added Tax Act, 2003 were complied with.
Issue (i): whether the movement of goods from West Bengal to Assam for execution of the contract was an inter-State sale or a stock transfer.
Analysis: The purchase order described a contract for design, manufacture, transportation, installation and commissioning of a complete false ceiling system, which brought the transaction within the definition of a works contract under section 2(ja) of the Central Sales Tax Act, 1956. Since works contract goods moving from one State to another for execution of the contract fall within the widened concept of sale under section 2(g) of the Central Sales Tax Act, 1956, the movement of goods to Assam was treated as a deemed inter-State sale. The consignee was therefore correctly shown as the purchaser in Assam, and the transaction was not accepted as a mere stock transfer.
Conclusion: The transaction was a deemed inter-State sale in the course of execution of a works contract, not a stock transfer.
Issue (ii): whether the statutory requirements for carrying documents under section 81 of the West Bengal Value Added Tax Act, 2003 were complied with.
Analysis: For goods carried out of West Bengal as a sale, section 81(1)(a) required two copies of the tax invoice, bill or cash memorandum together with prescribed documents. The documents produced at interception and seizure did not include the required tax invoice or equivalent sale document. On that basis, the seizure was held valid and the imposition of penalty under section 77 of the West Bengal Value Added Tax Act, 2003 was upheld as the materials disclosed an attempt to evade tax.
Conclusion: The statutory requirements were not complied with, and the seizure and penalty were sustained.
Final Conclusion: The revision application failed, and the orders of seizure and penalty were confirmed.
Ratio Decidendi: Goods moved from one State to another for execution of a works contract constitute a deemed inter-State sale, and when the movement is by way of sale the transporter must carry the prescribed sale documents under the relevant transit provision; failure to do so justifies seizure and penalty.
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