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TMI Blog2005 (1) TMI 644X X X X Extracts X X X X X X X X Extracts X X X X ..... he beedi leaves can be transported only under a valid permit, as per the pre-determined route to the destination. Any deviation in transportation, contrary to the transport permit, is not permissible. It is further the case of the appellant that it purchased beedi leaves under various auction bids and the quantity so purchased was directly transported by it from the forest depots in the Andhra Pradesh to Sholapur of Maharashtra State. It is further submitted that various depots, where the appellant had purchased beedi leaves, were quite away from the appellant's place of business at Kamareddy in Andhra Pradesh. Appellant's office at Kamareddy is established only to make purchases of beedi leaves and arrange their transport to the factory at Sholapur. Therefore, beedi leaves at no point of time are taken to Kamareddy, but are directly dispatched to the factory in Maharashtra. In the year 1989-90, the appellant, according to it, under a mistake, reported taxable turnover of ₹ 1.07 crores and paid tax on the purchase of beedi leaves, which had been directly dispatched from the forest depots to its factory at Sholapur, in accordance with the transport permit. The appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the purchases were inter-State in nature and, therefore, the Commercial Tax Officer had to pass a consequential order and allow refund to the appellant to the extent of taxes paid in both the years. When the case was pending, the respondent-Commercial Tax Officer issued show cause notice dated November 14, 1994 proposing to revise the order of Appellate Deputy Commissioner and restoring the order of the Commercial Tax Officer for both the assessment years 1989-90 and 1992-93. In the meantime, the final assessment for 1992-93 was made by the Commercial Tax Officer on March 30, 1996. He did not follow the order of Appellate Deputy Commissioner. Therefore, the appellant filed appeal against this order before the Appellate Deputy Commissioner, Secunderabad, on April 22, 1996. As such, it is claimed that the notice by the Commissioner proposing revision had become unnecessary. In response to the revision notice issued by the respondent, the appellant filed its objections dated October 16, 1994 and December 16, 1995, oral arguments were also advanced and written submissions were filed on May 27, 1995. The respondent, without, however, appreciating various contentions of the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ies were contrary to each other. In one of the replies, the appellant had stated that the office at Sholapur of Maharashtra State was its branch office, while in another it is stated that the office at Sholapur of Maharashtra State was head office . On facts, the Commissioner came to the conclusion that the office of the assessee at Kamareddy of Andhra Pradesh was not an agency, but a branch office. He also did not believe that the transactions effected by the assessee were agency transactions on behalf of a non-resident principal. After analysing the records and also the Rules, the Commissioner came to the conclusion that the delivery had taken place at various godowns in the State of Andhra Pradesh. The goods were moved from the forest godowns in the State of Andhra Pradesh, at the instance of purchaser, after taking the delivery. According to him, since the delivery had been taken in Andhra Pradesh, it was immaterial whether there was any further movement of goods or not, particularly for the seller. As far as the seller is concerned, the transaction was complete at the godowns when the delivery was taken. The Commissioner came to the following conclusions: that the assessee is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ods. It would not be an inter-State purchase. An out-State principal may first instruct his commission agent within the State of U.P. to purchase the goods on his behalf and to await his further instructions. Depending upon the market conditions and other circumstances, the ex-State principal may instruct his agent in the State either to sell the goods within the State or to despatch the goods beyond the State. If such were the case, Sri Sehgal would have been right in saying that the State of U.P. was competent to tax the purchase by the respondent-dealer. But that is not the case here on the facts found by the appropriate authorities. 6.. So in terms of this judgment, it is clear that if the goods moved from one State to another State, in pursuance of an agreement of sale and the sale is completed in the other State, it is an inter-State sale. It is also clear from the judgment that if there is a stipulation expressed or implied in the agreement of sale regarding movement of goods from one State to another, and if goods, in fact, moved from one State to another, then it would be inter-State sale . 7.. The facts in Co-operative Sugars case [1993] 90 STC 1 (SC) were that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt of the Supreme Court in Commissioner of Sales Tax, U.P. v. Bakhtawar Lal Kailash Chand Arhti [1992] 87 STC 196, the Supreme Court in Co-operative Sugars (Chittur) Ltd.'s case [1993] 90 STC 1 came to the conclusion that in order to constitute an inter-State sale what was important was whether movement of goods and sale are inseparably connected. It held: If we examine the facts of this case in the light of the above observations, it would be clear that the purchases made by the appellant are inter-State purchases. The appellant was permitted to purchase sugarcane in Coimbatore and Pollachi taluks only with a view to and exclusively for the purpose of transporting to its factory in Kerala. Whatever was purchased was transported to the appellant's factory in Kerala. It must, therefore, be held that this is a case where the movement of goods was occasioned by sale by the farmers or by the purchase by the appellant, whichever way one looks at it. The movement of the sugarcane from Tamil Nadu to Kerala is the incident of, and is inextricably connected with the sale/ purchase. The purchase and transport are but parts of one transaction. They cannot be dissociated in this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (2)(a) provided that after delivery and purchase of the leaves, goods could not be transported out of the depots, unless a permit was given by the permit officer. The permit officer is authorised to make inquiries, as he may deem it necessary and if satisfied he may issue transport permit. The transport permit will be issued in terms of form C under rule 4(1) of the Rules. The purchaser is bound to disclose among other things the destiny to which the Abnus leaves are to be transported. He has also to specify the route by which the leaves are to be transported and the mode of transport. So before taking delivery and before starting the movement of the goods, buyer has to disclose destination, route of transport and mode of transport. Unless these things are disclosed, there would not be any movement permit and if there is no movement permit, the goods cannot be transported. Therefore, in the present case, it was clear that goods have been purchased for being sent immediately to the factory at Sholapur of Maharashtra State. Therefore, it can be presumed that it was implied in the agreement of purchase itself that the goods had to be transported and utilised in the State of Maharas ..... X X X X Extracts X X X X X X X X Extracts X X X X
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