Revisional interference and inter-State sale tests under CST fail where F forms are filed and stock transfer is not rebutted.

Revisional interference under the Central Sales Tax regime requires a definite finding that the assessment is erroneous and prejudicial to Revenue; an order based only on suspicion, possible further enquiry, or proposed verification is unsustainable. On the facts, the assessee's filing of F forms discharged the initial statutory burden, and no cogent rebuttal material was shown, so the revisional order failed. Movement of coal from Madhya Pradesh to Uttar Pradesh was not shown to be occasioned by a pre-existing contract of sale under section 3(a); the goods were transferred to a stockyard, mixed and processed, and lost their distinct identity before sale. The movement was therefore treated as a stock transfer under section 6A, not an inter-State sale.

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Issues: (i) Whether the revisional order setting aside the assessment could be sustained when it rested on mere possibility of further enquiry and no definite material showing error in the assessment order. (ii) Whether the movement of coal from Madhya Pradesh to Uttar Pradesh constituted an inter-State sale under section 3(a) of the Central Sales Tax Act, 1956, or a stock transfer supported by F forms under section 6A of that Act.

Issue (i): Whether the revisional order setting aside the assessment could be sustained when it rested on mere possibility of further enquiry and no definite material showing error in the assessment order.

Analysis: Revisional jurisdiction could be invoked only when the assessment order was shown to be erroneous on a definite ground and prejudicial to Revenue. An order founded merely on suspicion, a need for more verification, or a prospect of gathering additional material was insufficient. The revisional authority itself was uncertain whether the movement was by stock transfer or inter-State sale, and the order was based on proposed enquiry rather than concrete findings. Once the assessee had filed F forms, the initial statutory burden stood discharged and rebuttal required relevant and cogent material.

Conclusion: The revisional order could not be justified in law and was unsustainable.

Issue (ii): Whether the movement of coal from Madhya Pradesh to Uttar Pradesh constituted an inter-State sale under section 3(a) of the Central Sales Tax Act, 1956, or a stock transfer supported by F forms under section 6A of that Act.

Analysis: Under section 3(a), inter-State sale arises only when the movement of goods from one State to another is the result of a covenant or incident of the contract of sale. Section 6A places the burden on the dealer to prove that the movement was otherwise than by sale, and filing of F forms discharges the initial burden. On the facts, the coal moved to the stockyard, got mixed and processed, and lost its distinct identity before any saleable goods emerged. The movement from Madhya Pradesh was not shown to be pursuant to any pre-existing contract of sale, and the broad linkage agreements with power houses did not amount to contracts for specific quantities from specific mines triggering inter-State movement.

Conclusion: The movement was a stock transfer and not an inter-State sale under section 3(a).

Final Conclusion: The impugned revision and the appellate affirmation were illegal and unsustainable, and the assessee succeeded.

Ratio Decidendi: Revisional interference under the Central Sales Tax regime cannot rest on conjecture or a desire for further enquiry, and movement of goods amounts to inter-State sale only when it is occasioned by a pre-existing contract of sale; where F forms are filed and the movement is shown to be a stock transfer, the statutory burden is discharged unless rebutted by cogent material.

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