2009 (11) TMI 818 - HC - VAT and Sales Tax

Disallowance of turnover in a sum of ₹ 3,57,41,932.63 as the consignment sale which claim was rejected by the assessing officer - whether treating the transaction as inter-State sale falling under section 3(a) of the Central Sales Tax Act, 1956 is correct or not? Held that - On a consideration of the position of law, we are of the opinion that the issues raised by the Revenue in the present writ petition being questions of fact which were thoroughly considered by the lower authorities they do not warrant any interference. W.P. dismissed.

Summary

Issues:
Dispute over disallowance of turnover as consignment sale under Central Sales Tax Act, 1956.

Analysis:
The case involves a dispute regarding the disallowance of turnover amounting to Rs.3,57,41,932.63 claimed as consignment sale under the Central Sales Tax Act, 1956. The Assessing Officer rejected the claim, treating the transaction as an inter-state sale under Section 3(a) of the Act. The Appellate Assistant Commissioner and the Sales Tax Appellate Tribunal both ruled in favor of the assessee, holding that the transactions were consignment sales based on documentary evidence provided by the assessee. The authorities emphasized the importance of substantiating the consignment sale claim under Section 6(A) of the CST Act and Rule 4(3-A) of the CST (Tamil Nadu) Rules. They noted that the burden of proof lies with the assessee to demonstrate the accuracy of the particulars furnished in Form-F.

The judgment referred to precedents such as SRI GANESAN TRADERS v. UNION OF INDIA and A.DHANDAPANI v. STATE OF TAMIL NADU AND ANOTHER to support the requirement for the assessee to prove the authenticity of the details provided in Form-F. Additionally, the judgment cited cases like DELHI IRON AND STEEL CO. LTD. v. COMMISSIONER OF SALES TAX, U.P. and STATE OF KARNATAKA v. JINDAL ALUMINIUM LIMITED to emphasize that mere same-day sale transactions do not automatically constitute inter-state sales. The court highlighted that in matters involving factual determinations, the writ court's intervention is limited unless there is a clear error on the record or a statutory violation.

The judgment also referenced the decision in RANJEET SINGH v. RAVI PRAKASH to underscore the limitations of the High Court's jurisdiction in correcting appellate court judgments. It emphasized that the High Court's supervisory jurisdiction under Article 226 and 227 of the Constitution does not extend to reevaluating evidence or correcting inferences like an appellate court. Ultimately, the court concluded that the Revenue's issues raised in the writ petition were factual in nature and had been thoroughly examined by the lower authorities, warranting no interference. Consequently, the writ petition was dismissed with no costs incurred.