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2024 (4) TMI 813 - HC - VAT and Sales TaxBenefit of Exemption from CST - stock transfer or inter-state sale - Whether the movement of goods in the instant case is only a stock transfer to the branches and liable to be exempted under Section 6A of the CST Act 1956 or the transaction is an interstate sale under Section 3(a) of the CST Act and liable for tax under CST Act 1956? - HELD THAT:- The impugned order shows that the works orders sent by the HO contain the details of individual customer companies and item wise description of the rubber sheets with specific design and quantity which manifests that rubber sheets are being tailor-made to suit the needs of the individual customers. The invoices are also raised on customers. It may be true that the finished goods are dispatched to the different branches. However, that fact is insignificant because in the entire process the branches are acting only as conduits between the manufacturing unit and customers. Where once movement of goods from one state to another state takes place on account of sale or purchase, the transaction assumes the character of inter-state sales in terms of Section 3(a) of CST Act, 1956. The judgment in SAHNEY STEEL AND PRESS WORKS LTD. AND ANOTHER VERSUS COMMERCIAL TAX OFFICER AND OTHERS [1985 (9) TMI 313 - SUPREME COURT] squarely apply to the case on hand. In the instant case also the movement of goods shall be regarded as inter-state sales rather than mere stock transfer - the argument of the petitioner in this regard, cannot be countenanced. The other contention of the petitioner is concerned, as rightly submitted by learned Government Pleader, the 2nd respondent has exercised his power under Section 9(2) of CST Act, r/w Section 20 (2) of APGST Act but not under Section 6A(3) of CST Act. There are no merits in the petitioner’s case and accordingly the Writ Petition is dismissed.
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