TaxTMI 
TaxTMI 
1982 (1) TMI 178
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....f is one for a declaration that sections 42 and 43 of the Tamil Nadu General Sales Tax Act, 1959, and rule 35 framed therein, are null and void, in so far as they relate to inter-State sales of the petitioner. The petitioner claims that it is a registered dealer in the State of Karnataka and is assessed to tax by the Commercial Tax Officer, XVI Circle, Bangalore. It also carries Central sales tax registration number in the State of Karnataka. The petitioner is the distributor for the paper manufactured by M/s. Kamrup Paper Mills, situate in Assam, and the petitioner effects sales in different parts of the country. The petitioner does not have any office or any other place of business within the State of Tamil Nadu. The procedure adopted ....
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.... effect any sales within the State of Tamil Nadu, since it is not an importer effecting the first sale in terms of section 9 of the Tamil Nadu General Sales Tax Act, 1959. It is on this basis the petitioner claims that the action taken by the first respondent to detain the goods at the check post at Tirumangalam, has resulted in considerable loss, and that the action taken is contrary to the provisions of Act 74 of 1956. The detention of the goods vehicle bearing registration number TNG 1881 of Sri Lakshmi Transports by the sales tax authorities at Tirumangalam, and treating the driver of the vehicle as if he is the dealer and calling upon the petitioner to pay the amount demanded as tax even before an order of assessment is made, is a h....
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....s at Sivakasi. In the absence of relative invoice of the petitioner, the movement of the goods cannot be said to be one coming under section 6(2) of the Act. Further no E-I form accompanied the goods and not even the serial number of E-I form is noted in any of the records furnished. The driver of the vehicle had stated that the goods were moved from Bangalore and not from Gauhati, and the petitioner is not a registered dealer in the State of Tamil Nadu, and the goods having been consigned to "self", namely, paper mills, and not to the petitioner, a sale bill as provided under sub-rules (11) and (12) of rule 26 of the Tamil Nadu General Sales Tax Rules, should have been issued. As the petitioner has resorted to avoid payment of single point....
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....uch transit sales are not unknown to the respondents. The reason for the detention of the goods at the check post and for making a demand on the driver was under the erroneous impression that the transaction was not an inter-State sale. It is stated in the counter-affidavit that the driver of the vehicle informed the check post authorities that it was the petitioner, who had despatched the goods from Bangalore to Sivakasi. Having thus known the name of the consignor and the consignee, there was no need for detention of the vehicle any longer. The invoice clearly states that the goods were despatched to Sivakasi through Highways Transport Corporation by the manufacturer in Assam. E-I form sale is also mentioned therein. While despatching ....
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....ugan Soap Works v. Assistant Commercial Tax Officer [1972] 30 STC 468, wherein this Court had held that "in the absence of definite proof or cogent material that a sale or purchase of goods has taken place at or about the time when an officer levies tax on the goods in the possession of another, it ceases to be a sales tax. Therefore, a demand for advance tax by the check post officer as a condition precedent for release of the goods detained by him in transit due to the absence of documents required under section 44 Prima facie one which is not authorised by law or justified under the Act". There can be no levy of tax on assumptions, expectancy or surmises. If on scrutiny of the documents, which have been taken custody of, the authoriti....
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....or the petitioner quite rightly contends that liability to pay tax can come into play only when there is a completed transaction of sale or purchase, and not in anticipation of sale or purchase. When a concluded sale has not been established, the demand for compounding fee at this stage does not occur, unless and until the assessment to pay tax is concluded. The contention of the petitioner is that the consignment could not be detained as the liability to pay tax as per rules 24(3) and 14 of Tamil Nadu Rules, arises only after the sale and not earlier. The respondents rely upon section 42(8) to contend that if the particulars of the owner of the goods are not made out, there is power in the authorities at the check post to inspect and de....