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TMI Blog1991 (8) TMI 289X X X X Extracts X X X X X X X X Extracts X X X X ..... right in holding that the sale by the assessee of EMI Vidicon tube type 2677 and EMI tape video recroding tape type 620/48/200 VP to the All India Radio in pursuance to the tender notice issued by the Directorate General of Supplies and Disposals was exempt from the levy of sales tax? 2.. Whether the sales of goods imported by M/s. Gramophone Co. of India from Middlesex, England, and subsequently sold to All India Radio constitute one sale or two distinct and different sales; one from the foreign seller to M/s. Gramophone Co. of India and other from Gramophone Co. of India to All India Radio through DGS & D? 3.. Whether the sales of goods by the dealer, i.e., M/s. Gramophone Co. is a sale in the course of import within the meaning of sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le. The assessee then wrote a letter dated January 17, 1972 to the Directorate General of Supplies and Disposals for the issue of import recommendation certificates. One such was issued by the Directorate on February 1, 1972. A certificate was also issued by All India Radio on February 3, 1972 that the items mentioned therein were the property of Government of India. The assessee wrote another letter on February 7, 1972 to the Directorate General of Supplies and Disposals for the expeditious issue of import licence of the said items. The import licences were issued on February 21, 1972 and February 22, 1972, in favour of the assessee for the import of the said items. The goods so imported were supplied to the All India Radio in terms of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the accepted tender to the All India Radio. The delivery schedule of those items to the All India Radio was further made dependant and co-related to the receipt of import licences. The nature of the goods were also specified to be of a particular manufacturer of Middlesex, England. Their sale to the Government, therefore, necessarily involved import, and this was very well understood by the parties to that tender and they made this as part of the accepted tender. Section 5(2) as aforesaid comes into play where the sale occasions import of goods into India. The present case would, therefore, be squarely covered by it inasmuch as it was as a result of agreement to sell the goods to the Government that the assessee imported those goods. Su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... several years and it was noted that the particular sale transaction had not resulted in the import. I, therefore, allow this appeal and hold that the sale of the aforesaid two items did not invite the levy of sales tax. " On an application being moved by the petitioner the aforesaid three questions of law have been referred to this Court. As will be evident from what has been stated hereinabove, the Sales Tax Tribunal has based its decision on the judgment of the Supreme Court in the case of KG. Khosla and Co. [1966] 17 STC 473 (SC). We, however, find that the learned Tribunal did not appreciate the facts of the case of KG. Khosla and Co. [1966] 17 STC 473 (SC) fully. In the case of KG. Khosla and Co. [1966] 17 STC 473 (SC) an agreemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the import recommendation certificates which were issued to the assessee. It was always contemplated and known that the goods which were to be supplied to the DGS & D had to be imported from abroad. Nevertheless the Supreme Court came to the conclusion that there were two sales which were involved in that case. One sale was that of the foreign supplier who sold to Binani Bros. and the other by the latter in favour of the DGS & D. The import had not been occasioned by the sale contract between Binani Bros. and the DGS & D. It may be noticed that in arriving at the aforesaid conclusion the Supreme Court referred to its earlier decision in the case of Coffee Board v. Joint Commercial Tax Officer [1970] 25 STC 528. That was a case involvin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eptance of tender, it was stipulated that the goods were being imported from abroad, nevertheless two independent sales transactions have taken place. There was a sale by a foreign exporter to the assessee and thereafter there was a sale by the assessee to the DGS & D. The sale which has occasioned the movement of goods from England to India is the sale made by the foreign exporter in favour of the assessee and not the sale made by the assessee in favour of the DGS & D. This sale has been made after the goods had been imported into India. The sale by the assessee to the DGS & D did not occasion the movement of goods from England to India. We are clearly of the opinion, that the decision of the Tribunal was not correct. Therefore, answer to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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