TaxTMI 
TaxTMI 
TaxTMI 
1982 (5) TMI 176
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....essment orders for the relevant assessment years are produced as annexure K1 dated 28th July, 1975, annexure K2 dated 16th December, 1975, and annexure K3 dated 25th March, 1978. The assessment orders indicate that the assessment orders are concluded against the assessee-company's branch at Bangalore where it is registered as a dealer in Karnataka State. The assessment orders in question are challenged on the sole ground that the assessee-company got itself assessed for the relevant years and paid tax under the Act in respect of the supply and sale of bus bodies to the corporation under a mistake of law treating such transactions as local sales while in fact the same were inter-State sales liable to tax under the Central Sales Tax Act in the State of Tamil Nadu where the bus bodies were built and sold to the corporation. 2.. Briefly stated, the facts leading to these writ petitions which involve common questions of law and fact are as follows: The assessee-company is having its registered office at Madurai and branches in other Southern States, including the State of Karnataka. In the year 1973-74 the assessee-company supplied thirty bus bodies and in the year 1974-75 five bodies....
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....ption claimed was in respect of Rs. 83,02,644.29 leaving a taxable turnover of Rs. 2,29,108.43. Having regard to the undisputed taxable turnovers of the three relevant assessment years the tax payable was determined together with surcharge under section 6-B of the Act for each of the years (sic). It is also recorded by the first respondent-assessing authority that the company had not effected any sales in the course of inter-State trade during the relevant year and therefore not assessable under the Central Sales Tax Act. It is necessary to point out that the assessee-company accepted the assessment orders as correct till it came to know about the decision of the Supreme Court in the case of Union of India v. K.G. Khosla and Co. Ltd. [1979] 43 STC 457 (SC) which was rendered on 6th March, 1979. 4.. Having regard to the ratio decidendi of the aforementioned case, the assessee-company preferred revision petitions under section 21(2) of the Act, inter alia, contending that bringing to tax the supply and sale of bodies under the Act treating such supplies and sales as intra-State or local sales was a mistake in law as the bodies were contracted to be built at Madurai and that they wer....
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....ny apparent error of law could be rectified under section 25-A of the Act. It is further asserted for the respondents that the revision petitions preferred against the assessment orders under section 21(2) of the Act were correctly held as not maintainable inasmuch as the section had been amended with effect from 1st January, 1978, conferring the power of revision to assessment orders which were only prejudicial to the revenue. 8.. It is further asserted that the transactions in question were intra-State sales having regard to the facts and circumstances in which the contracts or sales were concluded between the corporation and the assessee-company at Bangalore. In that circumstance, the respondents have prayed that the petitions be rejected as the assessment orders in question were properly made and no refund of tax was due to be made to the petitioner-assessee-company. 9.. Apart from the above statement of objections, the learned AdvocateGeneral appearing for the respondents, in the course of his arguments, raised a preliminary objection as to the maintainability of the writ petitions on the ground that the petitioner before this Court was the assessee-company's branch office a....
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.... to the filing of the petitions on 8th January, 1981. The further question that falls for determination is whether the petitioner is entitled to have the impugned assessment orders set aside as being without jurisdiction and claim for a direction from this Court for refund of the tax paid under the impugned assessment orders under a mistake of law. 12.. In furtherance of the rival contentions reliance was placed on numerous decided cases of the High Courts and the Supreme Court. I do not think any useful purpose will be served by adverting to all the cited cases. The controversy in the cases on hand can be narrowed down to the determination of the nature and character of the sales in respect of which provisions of the Act were pressed into service by the assessing authority. 13.. It requires no authority of decided cases that if a sale is an inter-State sale it will attract the provisions of the Central Sales Tax Act and such an inter-State sale or sales stand excluded from the operation of the Act. 14.. Sri Devanathan, the learned counsel for the petitioner-assessee-company has presented his case on a very narrow compass. It has been his argument that the impugned assessment o....
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....elivering them to the purchasers. Although the contracts of sale did not require or provide that the goods should be moved from Faridabad to Delhi, the movement of the goods was occasioned from Faridabad to Delhi, as a result or incident of the contracts of sale made in Delhi. 16.. In the light of the above enunciation of the Supreme Court, Sri Devanathan contends that looking at the invitation to tender which was addressed to tenderers both inside and outside Karnataka and the offer made by the assessee-company it was clear that the bodies could be built only at Madurai where the assessee-company has the head office and the factory, though it was not spelt out in detail in the offer or tender that the bodies were going to be built at Madurai. In fact, the thrust of his arguments has been that the corporation was fully aware that the bodies could be built only at Madurai and not at the branch office at Bangalore where only the factory is maintained for re-treading of tyres and repairing motor vehicles. The emphasis of the argument is entirely based on the ruling of the Supreme Court that a sale could be an inter-State sale even if the contract of sale did not specifically provide....
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....w that the movement of the bus bodies from Madurai to Bangalore was a direct incident of the contract. 18.. In the light of this, the contention of the learned Advocate-General that the contract of sale did not provide for the movement of goods from Madurai *Here italicised. to Bangalore and therefore notwithstanding that the tenderer chose to have the body built at Madurai, the sale which was contracted and concluded by delivery at Bangalore should be construed as intra-State sale and therefore not inter-State sale has no force. The ruling of the Supreme Court in Khosla's case [1979] 43 STC 457 (SC) is clear that irrespective of the absence of a specific term or condition in the contract for movement of goods, if movement is occasioned of the goods from one State to another State such a sale would be inter-State sale. The respondents' contention in the facts and circumstances of the case is liable to be rejected. 19.. Similarly, the contention of the learned Advocate-General that the facts in Khosla's case [1979] 43 STC 457 (SC) are different from the facts of the present case is also liable to be rejected as on a close examination, it is clearly seen that the facts are similar.....
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.... not any need to place any material before the assessing authority. The assessee-company's stand throughout before this Court and the revisional authority is that only after the decision in Khosla's case [1979] 43 STC 457 (SC) that it came to know that levy of Karnataka sales tax was not warranted in regard to the transactions as the same were only subject to payment of Central sales tax under the Central Sales Tax Act. 24.. In fact, it has been brought to the notice of the Court that after the decision in Khosla's case [1979] 43 STC 457 (SC) the Tamil Nadu sales tax authorities at Madurai initiated proceedings and brought to tax the very same transactions under the provisions of the Central Sales Tax Act. Appeals filed in that behalf by the assessee-company are said to be pending before the Tamil Nadu Sales Tax Appellate Tribunal (Madurai Bench). This fact has not been disputed by the respondents. A mere illegality in the course of the assessment proceedings may not compel this Court to interfere with the assessments after a considerable lapse of time. But when the levy of tax by the said assessment proceedings is clearly without jurisdiction rendering the levy of tax without the....