1989 (2) TMI 370 - HC - VAT and Sales Tax

Summary

Issues:
Interpretation of section 6A(1) of the Central Sales Tax Act regarding the mandatory requirement of filing F forms for proving transfer of goods not by way of sale.

Analysis:
The case involved a company assessed under the Central Sales Tax Act for the year 1975-76. The assessing authority added a sum to the taxable turnover due to the company's failure to produce F forms for stock transfers to its U.P. depot. The Deputy Commissioner of Sales Tax upheld this decision, which was later affirmed in a second appeal. The question before the court was whether the filing of F forms is a mandatory requirement under section 6A(1) of the Act.

The court examined the provisions of section 6A(1) and 6A(2) of the Central Sales Tax Act. It noted that the burden of proof lies on the dealer to show that the movement of goods was due to transfer and not sale. While the first part of section 6A(1) uses the word "shall" indicating a compulsory requirement, the second part uses "may," suggesting permissiveness. The court emphasized that the dealer can prove transfer through means other than F forms as well.

Relying on precedents from the Orissa High Court and a communication from the Government of India stating that filing F forms is not mandatory, the court held that the production of F forms is not compulsory under the Act. The court also considered Supreme Court decisions supporting this interpretation. Consequently, the court found that the Appellate Tribunal erred in deeming F form submission as mandatory and ruled in favor of the petitioner, allowing the tax revision case.

In conclusion, the court set aside the Appellate Tribunal's order and directed modification in line with the judgment. The court clarified that section 6A(1) does not restrict the assessee to only using F forms to discharge the burden of proof, allowing alternative methods in accordance with the law.