TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
When case Id is present, search is done only for this
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Writ Petitions Dismissed: Sandalwood Tax Ruling Upheld</h1> <h3>M/s. Laxmi Impex, M/s. Munnalal Sons and Co. (Perfumers) P. Ltd., M/s. N.D. Products Versus The District Forest Officer, The Commercial Tax Officer</h3> M/s. Laxmi Impex, M/s. Munnalal Sons and Co. (Perfumers) P. Ltd., M/s. N.D. Products Versus The District Forest Officer, The Commercial Tax Officer - TMI Issues:1. Quashing of orders directing payment of sales tax on sandalwood purchase.2. Interpretation of inter-state trade under the Central Sales Tax Act.3. Legal link between auction sale in Tamil Nadu and movement of goods to Karnataka.Issue 1: Quashing of Sales Tax OrdersThe petitioners sought to quash the orders directing payment of 12% sales tax on sandalwood purchase and requested collection of tax at 4% for inter-state trade under the Central Sales Tax Act. The court dismissed similar Writ Petitions previously, emphasizing that movement of goods to another state does not exclude the sale from being considered within the state. The court held that the demand for value-added tax under the TNVAT Act was justified, rejecting the claim of inter-state sale. The court emphasized that the sale was effected within Tamil Nadu, falling under the TNVAT Act, and the petitioners failed to establish a case for relief sought.Issue 2: Interpretation of Inter-state TradeThe court referred to a Division Bench decision in Karnataka Soaps and Detergents Ltd. v. District Forest Officer, Sathyamangalam, which highlighted that the auction sale of sandalwood in Tamil Nadu did not imply a legal link for goods movement to Karnataka. The court held that the movement of goods was voluntary and not a legal obligation, distinguishing it from an inter-state sale. The court rejected the plea that it was an inter-state sale, stating that the movement of goods was independent of the auction sale, and hence, the challenge to levy Tamil Nadu value-added tax failed.Issue 3: Legal Link between Auction Sale and Goods MovementThe court discussed the lack of a legal link between the auction sale in Tamil Nadu and the movement of goods to Karnataka. It emphasized that the movement was voluntary and not under any legal obligation, reinforcing the rejection of the contention that it was an inter-state sale. The court upheld the decision of the Division Bench, stating that the sale turnover would determine whether it was a local or inter-state sale, and in this case, the auction conducted within Tamil Nadu made the transaction local, despite goods being transported outside the state.In conclusion, the court dismissed the Writ Petitions, emphasizing the lack of legal basis for considering the transactions as inter-state sales and upholding the levy of Tamil Nadu value-added tax. The court's decision was based on the interpretation of relevant laws and the absence of a legal link between the auction sale and goods movement to another state.
TaxTMI 