2016 (3) TMI 886

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....Commercial Taxes, Special Circle, Bikaner Vs. M/s.Bikaner Woolen Mills Pvt. Ltd. and Appeal No.10/2000 - M/s.Bikaner Woolen Mills Pvt. Ltd. Vs. Assistant Commissioner, Commercial Taxes, Special Circle, Bikaner respectively, dismissing the appeal No.10/2000 filed by the Assessee and allowing the appeal No.268/2000 filed by the Revenue. 2. Both the revision petitions have been heard together and are being disposed of by this common order. 3. The learned Tax Board had dismissed the appeal No.10/2000 filed by the Assessee, holding that since the Assessee had collected the CST @ 2% on the branch transfers made by it of the carpet yarn from its Bikaner Branch to the Bhadoi (UP) Branch, therefore, the refund/adjustment of such CST paid cannot be....

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....y the Assessee on Rs. 24,74,860/- and held that not only such tax was leviable treating the said transactions as inter-State sales, but interest thereon also was leviable. 6. The first appeal filed by the Assessee before the learned Deputy Commissioner (Appeals), Commercial Taxes, Bikaner was partly allowed by the said authority on 15.10.1999 and while upholding the liability of tax @ 2% of Rs. 49,474/-, the Deputy Commissioner (Appeals) set aside the levy of interest following the decision of the Hon'ble Supreme Court in the case of India Carbon Ltd. Vs. State of Assam, (1997) 6 SCC 479, after which the law came to be amended by amending Section 9(2) of the CST Act, 1956. 7. Therafter, the Assessee took the matter further before the ....

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....s, instead of being S.O.S. Transfers or branch transfers by one Branch of the same Assessee to the other Branch, namely, from Bikaner (Raj.) to Bhadoi (UP). The question of interest, he submitted, would naturally depend upon the sustainability of the levy of the tax. 11. I have heard the learned counsels for the parties at length and perused the record. 12. The sine qua non for imposition of tax and interest thereon under the provisions of CST Act, 1956 is the movement of goods from one State to another, in pursuance of a pre existing contract between the parties. A contract of sale necessarily envisages existence of two parties or two different persons, may be natural persons or juristic persons, like corporates. A branch transfer is lik....

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....s of Rs. 34,96,908/- supported by Form 'F' were not actually branch transfers, but were inter-State sales. Neither the existence of two parties was brought on record by the Revenue, nor any such contract between such two parties was brought on record. 14. It cannot be over-emphasized and it is needless to say that the burden of proof in this regard squarely lies on the Revenue before levying the tax, while holding that the transactions in question amounts to a taxable event falling within the four corners of charging provisions of the Act itself. Such burden does not seem to have been even touched by the assessing authority, much less discharged in proper manner in the present case. The appellate authorities unfortunately did more ....