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TMI Blog1991 (6) TMI 218X X X X Extracts X X X X X X X X Extracts X X X X ..... h the business of certain chemicals and instruments and is also engaged in manufacture and sale of two articles known as "table-wax" and "wexol". It carries on its business at Rajkot. On August 10, 1973, the business premises of the assessee were searched and the account books and other documents for Samvat Years 2026 to 2029 were seized. 2.. The Sales Tax Officer, Rajkot, found that there was suppression of sales and therefore issued notice with regard to the correct assessment of the turnover and also issued notice with regard to certain sales effected by the assessee which were considered as local sales. According to the department these sales were really inter-State sales under section 3(b) of the Central Act and attracted the provisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment accordingly. The Sales Tax Officer also imposed penalty under the appropriate provisions of the Bombay Sales Tax Act, 1959 and also under the appropriate provisions of the Gujarat Sales Tax Act, 1969. As a result of this order, the amount credited by the assessee to the Sales Tax Officer through periodical returns of the relevant turnovers of sales were forfeited to the Government and the additional liability under the Central Sales Tax Act, 1956, accrued. The assessee filed appeal under the provisions of the Bombay Sales Tax Act, 1959 and the Gujarat Sales Tax Act, 1969. The appeals were heard by the learned Assistant Commissioner. He confirmed the finding arrived at by the Sales Tax Officer. The assessee preferred second appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Whether, on the facts and in the circumstances of the case, the Gujarat Sales Tax Tribunal was justified in law in holding that the disputed sales were subject to tax under the relevant provisions of the Bombay Sales Tax Act, 1959 and the Gujarat Sales Tax Act, 1969 and did not constitute inter-State sales under the provisions of section 3(b) of the Central Sales Tax Act, 1956?" 7.. The sales in question for different periods are as follows: S. No. Samvat year Amount Rs. 1 2025 36,671 2 2026 (1st half) 37,203 3 2026 (2nd half) 13,418 4 2027 37,472 5 2028 60,865 6 2029 4,334 The aforesaid sales were of table-wax and wexol. 8.. The Tribunal found on facts that as per the relevant terms of agreement between the assessee and its purc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acts the Tribunal came to the conclusion that the provisions of section 3(b) of the Central Sales Tax Act, 1956, were not attracted. 10.. The term "sale" is defined under section 2(g) of the Central Sales Tax Act, 1956, which means any transfer of property in goods by one person to another for cash or for deferred payment or for any other valuable consideration, and includes a transfer of goods on the hire purchase or other system of payment by instalments, but does not include a mortgage or hypothecation of or a charge or pledge on goods. Section 3 of the Central Sales Tax Act, 1956, provides as to when the sale or purchase of goods is said to have taken place in the course of inter-State trade or commerce. The relevant part of the sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n our opinion the Tribunal was rightly held that the provisions of section 3(b) of the Central Sales Tax Act, 1956, were not attracted. 11.. The Tribunal relied on the decision of the Supreme Court in the case of Tata Iron and Steel Co. Ltd. v. S.R. Sarkar reported in [1960] 11 STC 655. In that case the provisions of section 3(a) and (b) came up for consideration before the Supreme Court. The Supreme Court after referring to the definition of "sale" occurring in section 2(g) of the Act observed as follows: "By section 3, a sale or purchase of goods is deemed to take place in the course of inter-State trade or commerce if the sale or purchase (a) occasions the movement of goods from one State to another, or (b) is effected by transfer of d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that the expression "sale" has been defined in section 2(g) for the purpose of that Act. After referring to the definition of the term "sale" the Supreme Court held that this definition will be applicable as the term "sale" occurring in section 5(3) of the Act must mean transfer of goods by one person to another for cash or for deferred payment or for any other valuable considerations, and it cannot mean "agreement to sell". The Supreme Court also considered its earlier decision in the case of Balabhagas Hulaschand v. State of Orissa reported in [1976] 37 STC 207; AIR 1976 SC 1016. Therein it was, inter alia, observed that the word "sale " includes "agreement to sell". However, it is also observed that the word "sale" may include "agreem ..... X X X X Extracts X X X X X X X X Extracts X X X X
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