2017 (9) TMI 395 - HC - VAT and Sales Tax

Branch Transfers - Form-F - Whether under the facts and circumstances, the learned Tribunal erred in allowing the production of F-Forms without insisting the production of evidence? - Held that - If apart from non furnishing of F forms, the Assessing Officer had disputed about the movement of goods, the transactions could not have been taxed as inter-State sales. If the department was aggrieved by the same, it was open for the department to challenge the same before the first appellate authority. Not having done so, the department cannot reverse the situation - appeal dismissed.

Summary

Issues:
1. Whether the Tribunal erred in allowing the production of FForms without insisting on the production of evidence?
2. Whether the direction given by the Tribunal is contrary to the provisions of Section 6A of the Central Sales Tax Act?

Analysis:
1. The respondent assessee, dealing in electronic goods, claimed transfer of goods by branch transfer from Gujarat to Mumbai during the relevant period. The Assessing Officer granted benefits for transfers covered by FForms but treated those without FForms as interState sales. The first appellate authority did not grant benefits due to lack of evidence of physical movement of goods. The Tribunal noted the Assessing Officer's acceptance of goods movement but taxing them as interState sales. Despite incomplete FForms, the Tribunal remanded proceedings to allow the assessee to furnish complete forms. The High Court agreed with the Tribunal's view that if the Assessing Officer disputed goods movement besides FForms, transactions could not be taxed as interState sales. The department's failure to challenge this before the first appellate authority precluded reversing the situation.

2. The High Court dismissed the Tax Appeal and Civil Application, upholding the Tribunal's decision. The Tribunal's approach of allowing the production of FForms, despite incomplete forms, was deemed appropriate given the circumstances. The Court emphasized the importance of evidence regarding goods movement in determining the nature of transactions for tax purposes. The decision highlighted the need for the department to challenge disputed issues before the appropriate authority to avoid subsequent reversals. Overall, the judgment underscored the significance of adherence to procedural requirements and the proper assessment of evidence in tax matters to ensure fair treatment for taxpayers.