TaxTMI 
TaxTMI 
2016 (6) TMI 654
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....sion, New Mumbai. Petitioner, at its Cuttack Branch used to sell other automobile vehicles, namely, Hero Honda motorcycles, components, accessories and spare parts of Premier cars for which it has already paid tax to the Sales Tax Officer and for that used to pay sales tax under Odisha Sales Tax Act, 1947 (for short 'the Act'). Since the petitioner has no sale at Cuttack Branch of cars manufactured by M/s. Premier Automobiles Ltd., Mumbai, did not pay any tax under the Act. It is alleged, inter alia, that the learned Sales Tax Officer, Cuttack-I, Central Circle, Cuttack, the Assessing Officer, issued notice to produce the books of accounts. At the same time, the Assessing Officer got fraud case report against the petitioner. The report says that 176 numbers of cars have been procured from its branch office at Mumbai and sold to consumers at Odisha. According to the petitioner, no sale of such cars takes place in Cuttack because a customer desirous of purchasing Padmini car from the Mumbai under direct billing system, gives a letter of authorization in favour of the branch office situated at Mumbai to receive and to appoint a Transporter to drive down the vehicle from Mumbai to the ....
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....ioner-company. 4. The State preferred Second Appeal before the learned Odisha Sales Tax Tribunal, Cuttack in S.A. No. 114/1999-2000 and the Tribunal after hearing both the parties and relying upon the decisions of the Hon'ble Supreme Court in the case of Balabhagas Hulschand v. State of Orissa, AIR 1976 SC 1016 vide order dated 28.12.2010 held that the said transactions are not inter-State transactions and are intra-State transactions for which the above amount said to be deleted, should be added to the gross turn over and fresh assessment should be made. Against that order, petitioner preferred the present revision to set aside the order of the Tribunal and to restore the order dated 30.1.1999 passed by the Assistant Commisioner of Sales Tax, Cuttack-I Range, Cuttack in Sales Tax Appeal No. AA714 CU-I C/97-98. SUBMISSIONS : 5. Learned counsel for the petitioner submitted that the order of the learned Tribunal is erroneous, illegal and arbitrary. According to him, the said order of the Tribunal is couched with conjectures and surmises. He further submitted that the Mumbai branch office is purchasing the cars from the manufacturer at Mumbai and sends the same to registered ....
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....ks Ltd. (supra) and English Electronic Company of India (supra), are not applicable to the facts and circumstances of the case. So he submitted that the decision of the Tribunal, impugned herein, is valid and proper and the same should be upheld. Point for Determination : 8. After going through the contention of both the parties, there lies only point for determination whether the sale by the petitioner is inter-State coming under the C.S.T. Act or intra-State sale being exigible under the Act. DISCUSSION : 9. We have gone through the submissions made by the learned counsel appearing for the respective parties. Perused the record. It is undisputed fact that the petitioner is a registered dealer of premier padmini cars along with other vehicles. It is undisputed fact that the premier padmini cars are manufactured by M/s. Premier Automobiles Ltd., Mumbai. It is admitted fact that the petitioner has got its registered head office at Cuttack but has branch office at Mumbai and Bhubaneswar, and the cars are purchased by the petitioner-company from M/s. Premier Automobiles Ltd., Mumbai. It is also not disputed that the customers at Cuttack placed orders to purchase the cars f....
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....hat the customers have actually placed orders before M/s. Kalinga Auto Centre (P) Ltd., erstwhile Bombay and through demand draft in favour of Bombay branch, sale invoices were raised by the Bombay branch in the name of respective customers. He further held that simply receiving orders from customers and giving delivery after pre-delivery servicing as per their agreement by the Cuttack branch cannot alter the position. Thus he found the transaction is purely inter-State in nature as per Section 3(a) of the C.S.T. Act and the order of the learned Assessing Officer by adding the sale turn over of 176 nos. of cars for Rs. 3,99,05,848.61 paise into the gross and taxable turn over of the petitioner is untenable and same has to be excluded. 12. At this stage, the State of Odisha preferred Second Appeal before the learned Tribunal. Learned Tribunal in the Second Appeal after hearing the parties and quoting the decision of the Hon'ble Supreme Court passed the following order : "xx xx xx In the back drop of above law if the facts in the hand are considered, we are of the considered view that the branch office at Bombay was not a authorized dealer of M/s Premier Auto Mobiles Limi....
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....eemed to be occasioned by the sale. The present case clearly falls within this category. Case No.II-A who is a dealer in State X agrees to sell goods to B but he books the goods from State X to State Y in his own name and his agent in State Y receives the goods on behalf of A. Thereafter the goods are delivered to B in State Y and if B accepts them a sale takes place. It will be seen that in this case the movement of goods is neither in pursuance of the agreement to sell nor in the movement occasioned by the sale. The seller himself takes the goods to State Y and sells the goods there. This is therefore, purely an internal sale which takes place in State Y and falls beyond the purview of section 3(a) of the Central Sales Tax Act not being an inter-State sale. Case No.III-B a purchaser in State Y comes to State X and purchase the goods and pays the price thereof. After having purchased the goods he then books the goods from State X to State Y in his own name. This is also a case where the sale is purely an internal sale having taken place in State X and the movement of goods is not occasioned by the sale but takes place after the property is purchased by B and beco....
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....an incident of contract where the vehicle is being booked from the Cuttack office of the petitioner by the customers directly to its branch offfice at Mumbai and the Mumbai office after procuring the same, sends the vehicle to the Cuttack office where the customer takes delivery of the same. When the vehicle is sent from one State to another State, being an incident of contract, it is truely an inter-State sale. 18. In another decision in Sahney Steel and Press Works Ltd. (supra), Their Lordships have observed : " 1.1 The sale transactions were inter-state sales in as much as they satisfy the terms of clause (a) of section 3 of the Central Sales Tax Act. 1.2 It cannot be said that the Movement of the goods from Hyderabad to the branch office was only for the purpose of enabling the sale by the branch office and was not in the course of fulfillment of the contract of sale. Even if the buyer places an order with the branch office and the branch office communicates the terms and specifications of the orders to the registered office and the branch office itself is concerned with the sales dispatching, billing receiving of the sale price, the conclusion must be that....
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....nces of the above case are very much applicable to the facts and circumstances of the present case and accordingly we are not refrained from observing that the transaction in the present case is inter-State sale. 20. It is also reported in Rolta Motors Ltd (supra) where their Lordships observed in the following manner : "that the expression "sale or purchase occasions the movement of goods" means that either the contract of sale itself should provide for the movement of goods or the movement of goods must be incidental to the contract, there being no possibility of diversion of goods for any other purpose or to any other State. The Tribunal found that appropriation of the goods and delivery under the direct billing system took place at Haryana, that there were direct agreements rescind the contract if any vehicle other than that identified was delivered. The presence of the respondent as an intermediary did not make a difference to the nature of the transactions which were inter-State sales. The view of the Tribunal was justified." With due respect to the above decision and applying ratio of above decision, we are of the view that in the present case no doubt there i....