9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2023 (1) TMI 144 - HC - VAT and Sales TaxDisallowance of exemption under Section 5(2) of the CST - high sea sales - disallowance on the ground that same was not supported by documentary evidence - whether exemption could be denied for want of assessee's endorsement on the Bill of Lading? - HELD THAT - The exemption was denied on the premise that Bill of lading was not endorsed by the assessee. Further, it is held in para 31 that the settled position of law is, the Bill of Lading is only one of the ways to transfer the title and not the only way. It can be done either by handing over the Bill of Lading itself to the customers before the goods pass the customs barrier of India. However, having examined the documents available in the Intelligence Report, the Tribunal has concluded that the necessary documents were available only to the extent of the turnover of Rs.1,65,32,500/- and the learned Advocate had not filed the documentary evidence in respect of the remaining portion of the turnover. In RECKITT COLMAN OF INDIA LTD. VERSUS COLLECTOR OF CENTRAL EXCISE 1996 (10) TMI 100 - SUPREME COURT , the Apex Court has held that it is beyond the competence of the Tribunal to make out a case in favour of the Revenue, which the Revenue had never canvassed and which the appellants had never been required to meet. The KAT has rightly noted the correct position of law that Bill of lading is not the only way of transfer of title and it can also be done by even handing over the Bill of Lading to the customers. Further, on consideration of the Intelligence Report, KAT has satisfied itself that documents were available in respect of turnover of Rs.1,65,32,500/-. Denial of the exemption in respect of turnover of Rs.16,51,67,363/- being the remaining portion of the turnover was not the subject matter for consideration before the KAT - the order passed by the KAT is perverse and unsustainable in law. Appeal allowed.
Issues:
Challenge to common order by assessee on exemption under Section 5(2) of CST Act for high sea sales disallowed by Tribunal. Analysis: 1. The petitioner, an assessee, challenged a common order by the Karnataka Appellate Tribunal (KAT) regarding the disallowance of exemption under Section 5(2) of the CST Act for high sea sales amounting to Rs.16,51,67,363. 2. The main contention raised was whether the Tribunal was justified in denying the exemption due to lack of documentary evidence supporting the high sea sales, despite the assessee having tendered evidence accepted by authorities. 3. The petitioner's advocate argued that the Tribunal exceeded its jurisdiction by considering a point not originally raised in the appeal, questioning the Tribunal's authority to conduct a roving enquiry. 4. The facts revealed that the assessee imported automobiles and conducted high sea sales, claiming exemption under Section 5(2) of the CST Act for the relevant years. The Assessing Officer denied the exemption due to lack of endorsement on the Bill of Lading by the assessee. 5. The advocate for the assessee cited legal precedents to support the argument that the Tribunal's powers are limited to the subject matter of the appeal. It was contended that the Tribunal overstepped its jurisdiction by conducting a roving enquiry and limiting the exemption based on irrelevant material. 6. On the other hand, the Revenue's representative argued that the Tribunal's decision to limit the relief was justified as the agreement was not signed by the proper person overseas. 7. The High Court examined the contentions and the records presented, noting that the Tribunal denied the exemption based on the absence of endorsement on the Bill of Lading. However, the Court clarified that the Bill of Lading is not the sole method of transferring title and can also be achieved by handing it over to customers. 8. Referring to legal precedents, the Court emphasized that the Tribunal cannot introduce new arguments in favor of the Revenue that were not raised initially. The Court found the Tribunal's decision to limit the exemption amount without proper documentation for the remaining turnover to be unsustainable and perverse. 9. Consequently, the High Court allowed the appeal, setting aside the orders of the Assessing Officer, First Appellate Authority, and the Karnataka Appellate Tribunal. The questions of law were answered in favor of the assessee regarding the grant of exemption under Section 5(2) of the CST Act.
|
