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TaxTMI 
TaxTMI 
1999 (12) TMI 845
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....in the habit of accounting the sales of tyres and tubes only after payments were made by the buyers through banks and after clearance of the goods by them. Therefore, the assessing authority brought to assessment a taxable turnover of Rs. 30,81,471 taxable at various rates accounted for during 1994-95, apart from exempted goods turnover of Rs. 1,71,431 aggregating to Rs. 32,52,902. Regarding unfructified sales, the assessing authority observed that the claims have not been preferred in time by filing form "A4" and by complying with the condition prescribed in rule 23(2-B) of the Tamil Nadu General Sales Tax Rules, 1959. Therefore the claim was disallowed to the extent of Rs. 39,738 taxable at 9 per cent. In the first appeal, the Deputy C....
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....r the sale sent through banks were retired by the customers and goods taken delivery. In this connection, he relied on the decision of the Madras High Court in [1974] 34 STC 6 in the case of Kuppuswami Mudaliar & Sons v. State of Madras and also section 25 of the Sale of Goods Act, 1930 which relates to reservation of right of disposal. 4.. Mr. R. Mahadevan, the learned Government Advocate contended that the conclusions reached by the Appellate Tribunal are in accordance with law and therefore there is no case to interfere. 5.. We have considered the contentions carefully and perused the records. In the decision reported in [1974] 34 STC 6 (Mad.) (Kuppuswami Mudaliar Sons v. State of Madras) the issue related to inter-State sale by de....
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....he Sale of Goods Act, 1930 reads as follows: "(3) Where the seller of goods draws on the buyer for the price and transmits to the buyer the bill of exchange together with the bill of lading or, as the case may be, the railway receipt to secure acceptance or payment of the bill of exchange, the buyer is bound to return the bill of lading or the railway receipt if he does not honour the bill of exchange; and if he wrongfully retains the bill of lading or the railway receipt, the property in the goods does not pass to him." However, it is relevant to refer to section 2(n), explanation (3) of the Act which reads as follows: "Section 2(n): 'Sale' with all its grammatical variations and cognate expressions means every transfer of the proper....
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....expression "sale" has been defined in section 2(g) of the Central Sales Tax Act. Thus, in the present case before us also, the place and time of sale have to be reckoned only in terms of the definition of "sale" as contained in section 2(n) of the Act. Therefore, the reliance placed on the decision of the Madras High Court in [1974] 34 STC 6 (Kuppuswami Mudaliar & Sons v. State of Madras) wherein the passing of property on the basis of section 19 of the Sale of Goods Act was determined has no relevance in terms of the ratio of the decision of the Supreme Court reported in [1980] 46 STC 164 (Consolidated Coffee Ltd. v. Coffee Board, Bangalore). For the same reason, the reliance placed on section 25 of the Sale of Goods Act, 1930 also has no ....
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....e goods returned, to such authority, in such manner and subject to such conditions as may be prescribed." 8.. This section clearly says that if the goods sent are not taken delivery by the buyer, then the dealer is entitled to claim refund of the tax paid by him on such unfructified sale subject to certain condition. Thus, it is quite clear that a sale takes place when the goods are appropriated to the contract of sale and then an unfructified sale takes place when such goods are not taken delivery including by not retiring the documents sent through banks. Therefore, in the scheme of taxation under the Tamil Nadu General Sales Tax Act, 1959 to introduce any notion of passing of property into the frame work of section 2(n) of the Act wou....
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..... The circumstance that the purchaser had a right of rejection did not postpone the transfer of property in the goods." 9.. Thus, in the present case before us, we are of the firm view that section 2(n), explanation (3) of the Act governs the time and place of intra-State sale and that the provisions of the Sale of Goods Act pertaining to passing of property have no relevance to determine the time and place of sale. Thus, we find that the conclusions reached by the Appellate Tribunal that the sales took place on the dates of appropriation, namely, during 1983-84 in respect of the turnover of Rs. 32,52,902 is quite in order. As regards unfructified sale, there is clear non-compliance of the conditions contemplated in section 4-D of the....