TaxTMI 
TaxTMI 
2017 (6) TMI 29
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....ion 6(2) of the Central Sales Tax Act, 1956 being an inter state sales under Section 3(b) of the said act? (b) Whether in the facts and circumstances of this case the Tribunal was justified in holding that there was an attempt to evade tax? (c) Whether in the course of proceedings under Section 51(7) of the Punjab Value Added Tax Act, 2005 the nature of the transaction can be called into question? 3. As a result of the Tribunal having dismissed the appellants' appeal against the order of the Deputy Excise and Taxation Commissioner, the order of remand directed by the Deputy Excise and Taxation Commissioner stands. As a result the question of law that arises is whether the Tribunal rightly upheld the order of the Deputy Excise and Taxation Commissioner remanding the matter to the Assistant Excise and Taxation Commissioner i.e. the Adjudicating Authority. The appeal is admitted on this question of law. The determination of this question will, however, require our having to consider the provisions of the Central Sales Tax Act. 4. The appellants' case is as follows: M/s Nav Durga Industries sold 90 bales of cotton to the appellants on the terms and conditions contained in a....
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....ell within the ambit of Section 6(2) of the Central Sales Tax Act and is, therefore, exempted from tax under the CST Act. We, however, cannot accept his submission that the case is clearly established on undisputed facts and that, therefore, the first Appellate Authority and the Tribunal ought to have decided the matter themselves without remanding the matter to the Assistant Excise and Taxation Commissioner. 7. Sections 3 and 6(2) of the Central Sales Tax Act, 1956 read as under:- 3. When is a sale or purchase of goods said to take place in the course of inter- State trade or commerce A Sale or purchase of goods shall be deemed to take place in the course of inter-state trade of commerce if the sale or purchase- (a) occasions the movement of goods from one State to another or (b) is effected by a transfer of documents of title to the goods during their movement from one State to another. Explanation 1 : Where goods are delivered to a carrier or other bailee for transmission, the movement of the goods shall, for the purposes of clause (b), be deemed to commence at the time of such delivery and terminate at the time when delivery is taken from such carrier or bailee. Exp....
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....no disputed facts and that the facts clearly establish that the sales fall within the ambit of Section 6(2) of the Act. In our view, the order of remand was not only justified but infact protects the appellants' rights. The appellants' rights are protected, for on remand it would be entitled to establish its case including, if necessary by leading further evidence. 9. We will presume in favour of the appellants that there were two sales, one between M/s Nav Durga Industries and the appellants and the other between the appellants and M/s S.T. Cottex Exports Pvt. Ltd. Mr. Mittal contended that the sale by the appellant to M/s S.T. Cottex Exports Pvt. Ltd. falls within the ambit of Section 6(2) of the Act. Section 6(2) contemplates two sales. The first is referred to in the words "where a sale of any goods in the course of inter-State trade or commerce has either occasioned the movement of such goods from one State to another or has been effected by a transfer of documents of title to such goods during their movement from one State to another". The second sale contemplated in Section 6(2) is referred to in the words "any subsequent sale during such movement effected by a transfer of....
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....ent on the reverse of the LR by the appellant "Please Delivery To This Goods M/s S.T.Cottex Exports Pvt. Ltd. r11c-IRAQ-Machhiwara (LDH) TIN No.03921002721". The subsequent sale referred to in section 6(2) must be a sale during the movement of the goods effected by the transfer of documents of title to such goods to a registered dealer. In other words the subsequent sale must be during such movement i.e. movement caused by the first sale and must be effected by the transfer of documents of title to such goods to a registered dealer. It is not sufficient if the subsequent sale is effected by transfer of documents of title to such goods. It is also necessary that this second sale must be subsequent to the first sale and the subsequent sale must be during the movement of the goods under the first sale. 12. Two questions of fact arise in respect of the sale between the appellant and M/s S.T.Cottex Exports Pvt. Ltd. Firstly was it a subsequent sale, to wit, was it a sale entered into after the first sale referred to in section 6(2). There is nothing on record that expressly indicates whether or not it was. Both the invoices are of the same date i.e. 05.12.2013. Absent any evidence to t....
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....ants to M/s S.T. Cottex Exports Pvt. Ltd. was during such movement of the goods. Both the invoices are dated 05.12.2013. The onus was on the appellants to establish that the second transaction i.e. transaction between itself and M/s S.T. Cottex Exports Pvt. Ltd. was entered into during the movement of the goods from Rajasthan to Punjab. The evidence, in fact, indicates that the sale by the appellants to M/s S.T. Cottex Exports Pvt. Ltd., even assuming it to be the second sale, was prior to the movement of the goods effected by the first side. As mentioned earlier, the cotton bales had on them the mark 'ST'. The name of the purchaser of the goods from the appellants is M/s S.T. Cottex Exports Pvt. Ltd. On the record as it stands, there is no other explanation for the letters 'ST' used on the bales. The presumption, therefore, that the word's indication of M/s S.T. Cottex Exports Pvt. Ltd. was reasonable and justified. Upon remand, the appellants would have the opportunity of explaining the use of the letters 'ST' as well. 15. Mr. Mittal next submitted that, in any event, the State of Punjab would not be entitled to collect the Central Sales Tax. In this regard,....