2010 (2) TMI 1062 - HC - VAT and Sales Tax

Summary

Issues:
Claim of exemption under section 6A of the Central Sales Tax Act, 1956 for pulses and grams as stock transfer vs. inter-State sale.

Analysis:
The writ petition sought to challenge the order passed by the third respondent regarding the claim of exemption under section 6A of the Central Sales Tax Act, 1956. The petitioner, a registered dealer of pulses and grams, claimed exemption for the assessment year 1990-91 for despatches made through stock transfer. The assessing officer initially denied the claim based on a report from the Enforcement Wing Officer, stating it was an inter-State sale. However, the Appellate Assistant Commissioner allowed the appeal, determining it was a stock transfer. Subsequently, the Joint Commissioner revised the order, rejecting the dealer's claim for exemption. The petitioner then approached the High Court seeking relief.

In determining whether the transaction was a stock transfer or an inter-State sale, two key considerations were identified. Firstly, it must be established that the movement of goods occurred from one state to another, with the burden of proof lying on the assessee. Secondly, it must be determined whether a contract of sale was entered into by the dealer, with the burden of proof resting on the Revenue. The assessee provided various documents to support their claim, including a covering letter, Form XX quadruplicate copy, and a sale patti. The Appellate Assistant Commissioner, based on these materials and additional evidence, concluded that the transaction was indeed a stock transfer, citing relevant judgments for support.

However, the Joint Commissioner, in revising the order, relied on statements allegedly given by the assessee-dealer, which were not part of the original assessment or appeal proceedings. These statements were considered for the first time during the revision process. The High Court found that such new materials could not override the factual findings of the Appellate Assistant Commissioner, leading to the conclusion that the transaction was a stock transfer and not an inter-State sale. Consequently, the writ petition was allowed, and the transaction was deemed a stock transfer, granting the petitioner relief.