2004 (12) TMI 648 - HC - VAT and Sales Tax

Summary

Issues Involved:
1. Whether the sales of goods worth Rs. 8,58,343 by the respondent-assessee to five different parties in Rajasthan qualify as inter-State sales under section 3(a) of the Central Sales Tax Act, 1956.
2. Whether the onus of proving the movement of goods from Gujarat to Rajasthan lies on the respondent-assessee or the Revenue.
3. Whether the evidence provided by the respondent-assessee, including "C" forms, was sufficient to establish the transactions as inter-State sales.

Issue-wise Detailed Analysis:

1. Qualification of Sales as Inter-State Sales:
The primary issue was whether the sales of goods worth Rs. 8,58,343 by the respondent-assessee to five different parties in Rajasthan qualify as inter-State sales under section 3(a) of the Central Sales Tax Act, 1956. The Tribunal accepted the assessee's claim that the sales were inter-State sales, but the Revenue contended that the sales were local. The Tribunal found that the goods moved from Gujarat to Rajasthan as a result of a contract of sale, establishing a conceivable link between the sale and the movement of goods. The court reiterated that for a sale to qualify as an inter-State sale, the movement of goods must be occasioned by the contract of sale, which can be express or implied.

2. Onus of Proving Movement of Goods:
The Revenue argued that the onus of proving the movement of goods from Gujarat to Rajasthan lies on the respondent-assessee. However, the court held that the burden of proving an averment lies on the party making the averment. Since the Revenue claimed that there was no movement of goods, it was their responsibility to disprove the assessee's contention. The court referenced the Supreme Court's decision in Commissioner of Sales Tax, U.P., Lucknow v. Suresh Chand Jain, which stated that the onus lies on the Revenue to disprove the dealer's contention.

3. Sufficiency of Evidence Provided by Respondent-Assessee:
The respondent-assessee provided various documents, including indent memos, excise gate passes, shipping memos, and "C" forms, to support their claim of inter-State sales. The court noted that the tender of form "C" by the selling dealer raises a fundamental presumption that the purchasing dealer is a registered dealer. The court criticized the Revenue for ignoring the evidence provided by the assessee and failing to undertake the requisite exercise to verify the genuineness of the transactions. The court held that the Tribunal was justified in treating the sales as inter-State sales based on the evidence provided.

Conclusion:
The court concluded that the Tribunal was justified in treating the sales of goods worth Rs. 8,58,343 as inter-State sales under section 3(a) of the Central Sales Tax Act, 1956. The question referred was answered in the affirmative, in favor of the assessee and against the Revenue. The reference was disposed of accordingly, with no order as to costs.