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2020 (2) TMI 1161 - HC - VAT and Sales TaxRequirement of Revision/Re-assessment - Branch Transfer - non-compliance with the terms under Rule 4 (3-A) of the Central Sales Tax Rules - Form-F duly verified - HELD THAT - The Tribunal was right in setting aside the order passed by the First Appellate Authority holding that the compliance with the requirement under Rule 4(3-A) of the Rules is mandatory, in view of the Circular issued by the Principal Commissioner and Commissioner of Commercial Taxes, in Acts Cell III/124278/94 dated 23.12.1994 reflected in paragraph 34 of its order of the learned Tribunal. Petition dismissed.
Issues:
1. Dispute over branch transfer transaction. 2. Compliance with Rule 4(3-A) of the Central Sales Tax Rules. 3. Validity of the order passed by the First Appellate Authority. 4. Interpretation of legal position upheld by the Supreme Court. Issue 1: Dispute over Branch Transfer Transaction The State filed a Writ Petition challenging the order of the Sales Tax Appellate Tribunal, which allowed the Assessee's appeal regarding a branch transfer transaction supported by Form-F. The Tribunal found no discrepancies in the Form-F declarations and rejected the Department's grounds for disallowance. The Tribunal emphasized the legal validity of Form XX as transportation documents and the mode of remittance by DD. It highlighted that without concrete findings, tax liability cannot be imposed on the Assessee. The Tribunal also referenced the assessment records and rejected the revision based on insufficient evidence. The High Court concurred with the Tribunal's findings, emphasizing the need for specific evidence to establish interstate sales under the CST Act. Issue 2: Compliance with Rule 4(3-A) of the Central Sales Tax Rules The Assessing Authority's revision of assessments for the years 1989-90 to 1991-92 was based on D3 proposals, which were found to lack factual evidence or legal sanction. The Tribunal set aside the First Appellate Authority's order, noting a violation of the Principal Commissioner's instructions regarding assessments reopened due to non-maintenance of accounts. The Enforcement Wing's inspection did not yield incriminating records, leading to a lack of basis for further proceedings. The High Court agreed with the Tribunal's decision, emphasizing the importance of adherence to legal provisions in assessments. Issue 3: Validity of the Order by the First Appellate Authority The High Court upheld the Tribunal's decision to set aside the First Appellate Authority's order, emphasizing the correctness of the Tribunal's interpretation of Rule 4(3-A) requirements. The Court found no merit in the State's Writ Petition, leading to its dismissal without costs. Issue 4: Interpretation of Legal Position Upheld by the Supreme Court The legal position established by the Supreme Court in the case of Ashok Leyland Limited Vs. State of Tamil Nadu was cited, emphasizing the conclusive nature of determinations made by statutory authorities. The Supreme Court's findings highlighted the importance of verifying Form F declarations to ascertain the factual transfer of goods. The High Court, after considering the Supreme Court's judgment, affirmed the Tribunal's decision and dismissed the Writ Petition. In conclusion, the High Court upheld the Tribunal's decision, emphasizing the importance of specific evidence and legal compliance in tax assessments. The Writ Petition was dismissed, and no costs were awarded.
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