Intra-State sale finding cannot rest on contradictory reliance on the same report and without independent supporting material.

Where the revenue relied on a Special Investigation Branch report stating that goods were transported from Allahabad to Calcutta and sold there, it could not on the same material treat the transaction as an intra-State sale under the U.P. Trade Tax Act, 1948. The report also linked the dealer's Form-F to the claim of benefit under Section 6-A of the Central Sales Tax Act, 1956, and no independent material supported a contrary intra-State finding. The authorities' contrary conclusion was therefore unsustainable, the impugned order was set aside, and the matter was remitted for reconsideration in accordance with law on the admitted nature of the transaction.

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Issues: Whether the transaction supported by the Special Investigation Branch report could be treated as an intra-State sale under the U.P. Trade Tax Act, 1948, when the revenue had relied on the same report to allege sale of the goods at Calcutta and to deny the benefit of Section 6-A of the Central Sales Tax Act, 1956.

Analysis: The goods were admittedly transported from Allahabad to Calcutta and Form-F had been issued. The reassessment under Section 21 of the U.P. Trade Tax Act, 1948 was founded on the Special Investigation Branch report, which itself indicated that the goods had been sold at Calcutta and that the dealer had procured Form-F to claim the benefit of Section 6-A of the Central Sales Tax Act, 1956. Once the revenue relied on that report, it could not adopt a contradictory stand and treat the same transaction as an intra-State sale merely on presumption, particularly when no other material supported that conclusion.

Conclusion: The transaction was not liable to be treated as an intra-State sale on the material relied upon by the revenue, and the contrary findings of the authorities could not stand.

Final Conclusion: The impugned order was set aside and the matter was remitted for reconsideration in accordance with law on the basis of the admitted nature of the transaction.

Ratio Decidendi: A revenue authority cannot, after relying on a report that treats the goods as sold outside the State, reject that very basis and sustain an intra-State sale finding in the absence of independent supporting material.

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