9911796707
TMI Blog1987 (7) TMI 568X X X X Extracts X X X X X X X X Extracts X X X X ..... in rakes and sent the railway receipts in favour of the assessee. The assessee endorsed these railway receipts to the various allottees while the goods were in movement. The sales of coal so made by the assessee during the relevant assessment year amounted to Rs. 6,55,623.54. Before the assessing authority, namely, Commercial Taxes Officer, Special Circle I, Jaipur, the assessee submitted that it was not liable to pay sales tax under the Central Sales Tax Act, 1956 (hereinafter referred to as "the Act") on the aforesaid sales of coal for the reason that the said transactions did not constitute sale under section 2(g) of the Act and further that in any event the said transactions could not be subjected to the payment of Central sales tax a second time as Central sales tax at 2 per cent had already been charged on the same in Bihar and coal is included in the category of declared goods under section 14 of the Act. The assessing authority held that the transactions constitute transfer of property for valuable consideration and were covered by the definition of "sale" as contained in section 2(g) of the Act and since the said sales were effected by transfer of documents during the mov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed Chairman of the Board of Revenue was affirmed. Thereafter the petitioner moved an application under section 15(1) of the Rajasthan Sales Tax Act, 1954 for referring to this Court the question arising from the order passed by the Division Bench of the Board of Revenue. The said application of the petitioner was allowed by the Board of Revenue by order dated 17th December, 1979, and the Board of Revenue referred the following questions for the opinion of this Court: "(1) Whether, on the facts and in the circumstances of the case, the turnover of Rs. 6,55,623.54 involving sale of coal (which is declared goods) was liable to Central sales tax in Rajasthan as inter-State sales under section 9 of the Central Sales Tax Act and connected provisions, when Central sales tax had already been paid on the same goods in another State where the movement of the goods in question had commenced? (2) Whether, on the facts and in the circumstances of the case, section 15 of the Central Sales Tax Act would apply?" On the basis of the aforesaid order of reference, this reference was registered as D.B. Sales Tax Reference No. 79 of 1980. During the pendency of the reference the Rajasthan Sales Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the goods shall, for the purpose of clause (b), be deemed to commence at the time of such delivery and terminate at the time when delivery is taken from such carrier or bailee. Section 6 deals with the liability to tax on inter-State sales. In subsection (1) to section 6 tax under the Act is payable on all sales of goods other than electrical energy effected by a dealer in the course of inter-State trade or commerce during any year. In sub-section (2) of section 6 it is provided that where a sale of any goods in the course of inter-State trade or commerce has either occasioned the movement of such goods from one State to another or has been effected by a transfer of documents of title to such goods during their movement from one State to another, any subsequent sale during such movement effected by a transfer of documents of title to such goods shall be exempt from tax under the Act if the said subsequent sale is (A) to the Government, or (B) to a registered dealer other than the Government, if the goods are of the description referred to in subsection (3) of section 8 of the Act. The aforesaid exemption from tax granted under sub-section (2) of section 6 is subject to the fu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment from the State of Bihar to the State of Rajasthan the assessee transferred the documents, namely, the railway receipts in favour of the various allottees. Since the sales by the assessee in favour of the various allottees were effected by transfer of documents of title in the goods during their movement from the State of Bihar to the State of Rajasthan, the said sales are fully covered by the provisions of section 3(b) of the Act and they must be held to be sales made in the course of inter-State trade or commerce. The only question which requires consideration is as to whether the said sales are exempt from payment of tax under the provisions of the Act, In this connection it may be stated that exemption from the payment of tax under the Act is permissible under sub-section (2) of section 6 of the Act which lays down that where a sale of any goods in the course of interState trade or commerce has either occasioned the movement of such goods from one State to another or has been effected by the transfer of documents of title to such goods during their movement from one State to another, any subsequent sale during such movement effected by a transfer of documents of title to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f inter-State trade or commerce, whether such sales fall within clause (a) or clause (b) of section 3, shall be levied by the Government of India, and the tax so levied shall be collected by that Government in accordance with the provisions of sub-section (2), in the State from which the movement of the goods commenced: Provided that, in the case of a sale of goods during their movement from one State to another, being a sale subsequent to the first sale in respect of the same goods, the tax shall, where such a sale does not fall within sub-section (2) of section 6, be levied and collected, in the State from which the registered dealer effecting the subsequent sale obtained or, as the case may be, could have obtained, the form prescribed for the purposes of clause (a) of sub-section (4) of section 8 in connection with the purchase of such goods." It may be stated that the aforesaid provisions of section 9 were substituted by section 6 of the Central Sales Tax (Amendment) Act, 1969 and the said amendment has been made with retrospective effect from the date of enactment of the Central Sales Tax Act, 1956. The aforesaid provisions in section 9 relate to levy and collection of tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... another being a sale subsequent to the first sale in respect of the same goods, the tax shall, where such sale does not fall within subsection (2) of section 6, be levied and collected in the State from which the registered dealer effecting the subsequent sale obtained the form prescribed for the purposes of clause (a) of sub-section (4) of section 8 in connection with the purchase of such goods." In State of Madras v. K. Nandagopal Chetty [1968] 22 STC 290 the learned Judges of the Madras High Court have observed that there was a lacuna in the proviso to sub-section (1) of section 9 inasmuch as the jurisdiction of the taxing State was dependant upon the act or failure on the part of the subsequent seller, and there was nothing in the Act which obliged the seller to obtain form C and the language of the said proviso did not cover a case where dealer fails to obtain declaration in form C. The defect that was pointed out by the Madras High Court in the aforesaid decision was removed by the Central Sales Tax (Amendment) Act, 1969 whereby proviso to sub-section (1) of section 9 was substituted with retrospective effect. In the amended provision the words "or, as the case may be, could ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ew of sub-section (2) of section 8 of the Act, the Central sales tax at the rate of 4 per cent could be levied on sales of coal in the course of inter-State trade or commerce. In the present case Central sales tax at the rate of 2 per cent was charged by the supplying collieries in Bihar and Central sales tax at the rate of 2 per cent has been levied under the impugned assessment orders. The total amount of Central sales tax that has been levied does not, therefore, exceed the limit of 4 per cent prescribed under sub-section (2) of section 8 of the Act. In my opinion, therefore, it must be held that: (i) On the facts and in the circumstances of the case the turnover of Rs. 6,55,623.54 involving sale of coal was liable to Central sales tax in Rajasthan as inter-State sales under section 9 of Central Sales Tax Act although Central sales tax had already been paid on the same goods in the State of Bihar where the movement of the goods in question had commenced; (ii) On the facts and in the circumstances of the case, section 15 of the Central Sales Tax Act would not be applicable to the present case. The revision is, therefore, allowed and the orders dated 22nd December, 1976 passed ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
