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2020 (1) TMI 1126 - HC - VAT and Sales TaxLevy of sales tax - inter-state sales or intra-state sales - Form XXVIII-B as prescribed under Rule 31 of the Bihar Sales Tax Rules, 1959 issued - the claim of the petitioner as regards the counter-sales, which had been made to the consignees outside the State of Jharkhand, but claimed as sales made within the State (intra-State sales), has been rejected. HELD THAT - The State Government itself, after the decision of the Patna High Court in Laxmi Hard Coke case 1996 (4) TMI 523 - PATNA HIGH COURT , prescribed three types of road permits in the shape of blue coloured, pink coloured and green coloured Forms XXVIII-B. The blue coloured Form XXVIII-B was made for transportation of the goods from within the State to outside the State. This was done by the State Government in the year 1997, while the State of Bihar was unified. After the bifurcation of the State in the year 2000, the State Government of Jharkhand in its Department of Commercial Taxes, came out with the letter dated 10.01.2002, as contained in Annexure-B to the counter-affidavit, wherein it was clearly stated that unless the satisfaction about the inter-State sale, as on the four points detailed in the said letter is arrived, the transaction cannot be considered to be inter-State sale. It is found that neither in the impugned assessment order, nor in the impugned Judgement passed by the Tribunal, there is any mention that the authorities, before coming to the conclusion that the sales in question were in fact the inter-State sales, had verified the documents of the petitioner relating to the four points as detailed in the letter dated 10.01.2002. Faced with this situation, it is found that neither the impugned assessment order, nor the impugned Judgement passed by the Tribunal, can be sustained in the eyes of law, as they have held the transactions in question to be inter-State sales, only on the basis of the road permits issued by the petitioner firm. As such, both these impugned order / Judgement cannot be sustained in the eyes of law. The matter remanded back to the Assessing Authority, to determine the liability of Central Sales Tax of the petitioner afresh - petition allowed by way of remand.
Issues Involved:
1. Challenge to the assessment order dated 11.01.2009. 2. Challenge to the judgment dated 05.12.2017 by the Commercial Taxes Tribunal. 3. Determination of whether sales were intra-State or inter-State. 4. Compliance with legal precedents and statutory requirements. Detailed Analysis: 1. Challenge to the Assessment Order Dated 11.01.2009: The petitioner contested the assessment order passed by the Deputy Commissioner, Commercial Taxes, Urban Circle, Dhanbad, which rejected the petitioner's claim that counter-sales made to consignees outside Jharkhand were intra-State sales. The petitioner argued that the assessment was incorrectly based on the use of blue-colored road permits, which permitted the movement of goods outside the State. The petitioner relied on the precedent set by the Division Bench of the Patna High Court in Laxmi Hard Coke Manufacturing Company Vs. State of Bihar, which stated that the issuance of Form XXVIII-B road permits alone could not determine the nature of the sale as inter-State. 2. Challenge to the Judgment Dated 05.12.2017 by the Commercial Taxes Tribunal: The petitioner also challenged the Tribunal's judgment, which upheld the Assessing Authority's findings and set aside the Appellate Authority's order that had previously ruled in favor of the petitioner. The Tribunal relied on a decision from Bharat Coal Product Vs. State of Jharkhand, which negated the claim that transactions were intra-State based solely on the issuance of road permits. 3. Determination of Whether Sales Were Intra-State or Inter-State: The core issue was whether the sales were intra-State or inter-State. The petitioner argued that the sales were completed within Jharkhand and that the movement of goods outside the State was not an incident of the sale or contract of sale. The petitioner cited the Patna High Court's ruling in Laxmi Hard Coke, which held that the movement of goods facilitated by Form XXVIII-B was not a determining factor for inter-State sales. 4. Compliance with Legal Precedents and Statutory Requirements: The court examined whether the Assessing Authority and the Tribunal complied with the legal precedent set by the Patna High Court and the statutory requirements. The court noted that the State Government had issued a resolution specifying different colored road permits for different types of transportation and a letter dated 10.01.2002, which outlined four points to determine inter-State sales. The court found that neither the assessment order nor the Tribunal's judgment verified the documents related to these four points. Conclusion: The court concluded that the assessment order and the Tribunal's judgment could not be sustained as they were based solely on the issuance of blue-colored road permits without verifying the necessary documents. The court set aside both the assessment order and the Tribunal's judgment and remanded the matter back to the Assessing Authority to determine the liability of Central Sales Tax afresh, based on the four points detailed in the letter dated 10.01.2002. If the transactions were found to be intra-State sales, the tax deposited by the petitioner was to be refunded with statutory interest. The writ application was allowed with these directions.
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