2006 (7) TMI 607 - HC - VAT and Sales Tax

Summary

Issues:
Whether the sale of vehicles to the Government of India under five invoices was in the course of export covered by section 5(1) of the Central Sales Tax Act, 1956.

Analysis:
The case involved a dispute regarding the applicability of section 5(1) of the Central Sales Tax Act to the sale of vehicles by a dealer to the Government of India for export. The Revenue argued that the transaction did not fall within the scope of section 5(1), citing previous division bench judgments. On the other hand, the respondent relied on a Supreme Court judgment in the case of State of Karnataka v. Azad Coach Builders Pvt. Ltd. to support their position that the transaction was covered by sub-section (1) of section 5 of the CST Act.

The court examined the documents produced by the respondent during the hearing and concluded that there was a commitment from the Government of India to gift trucks to the Government of Tanzania, leading to the export of the goods in question. The court found that the transaction met the criteria set by the Supreme Court in the Azad Coach Builders Pvt. Ltd. case. Additionally, the court analyzed the test laid down in the division bench judgment of Narang Hotels and Resorts Pvt. Ltd. to determine if the sale had occasioned the export, ultimately agreeing with the respondent's arguments. The court distinguished the Usha Martin Black Ltd. case and found that it did not contradict the principles established in the Narang Hotels and Resorts Pvt. Ltd. case. The judgments cited by the Revenue were deemed irrelevant and did not support their case.

Ultimately, the court held that no substantial question of law arose in the application, leading to its dismissal without costs.