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TMI Blog2006 (1) TMI 565X X X X Extracts X X X X X X X X Extracts X X X X ..... Constitution of India. 2. The case of the petitioner-dealer is that the petitioner No. 1 is a partnership firm and petitioner No. 2 is one of its partners and the petitioner-firm is registered under the Act of 1941 and thereafter became registered dealer under the West Bengal Sales Tax Act, 1994. The petitioner is engaged in the business of purchase of tea chest panel from West Bengal and sells those either in West Bengal or outside West Bengal. It also sells to other dealers who purchase the same for the purpose of export. The petitioner duly submitted return under the Bengal Finance (Sales Tax) Act, 1941 for the four quarters ending March 31, 1994. The respondent No. 2, C.T.O. Ultadanga Charge passed an assessment order dated June 12, 1996 for assessment for the said quarter ending March 31, 1994. He found some amount due from the petitioner and made a demand of the said tax and interest which the petitioner duly paid. But respondent No. 1, D.C., Commercial Taxes, Calcutta North Circle, issued a notice in form IX in September, 1999 proposing to reopen the assessment to enhance the amount of assessment for the said period by disallowing a sum of Rs. 9,33,750 from the claim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of section 5 of the Act of 1941 read with sub-section (3) of section 5 of the C.S.T. Act, 1956. Rule 10(a) and rule 10(b) of the Central Sales Tax (Registration and Turnover) Rules, 1957 deal with the provisions for issuance of form H covering sale in the course of export out of the territory of India. It will be seen that in the C.S.T. Rules, 1957, no such condition has been prescribed for covering export under section 5(3) when the purchase is made within the State of West Bengal. Rule 11 of the C.S.T. (West Bengal) Rules, 1958 makes an omnibus vehicle for the State to frame rules and prescribe forms to cover up transactions under the C.S.T. Act, which have not been covered under the C.S.T. (Registration and Turnover) Rules, 1957 and those rules framed by the State Government must not be inconsistent with the C.S.T. Act. So, the State has power and competence to frame rules which are not inconsistent with the C.S.T. Rules. 4.. In the affidavit-in-reply, the petitioner denies position of law as stated in the affidavit-in-opposition and reiterates that State has no power and competence to frame rules which are contrary to the provisions of the C.S.T. (Registration and Turnover) R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on as above, he refers to a ruling reported in [1991] 54 ELT 3 (Chemicals Fibres of India Ltd. v. Union of India) which is a decision rendered by the honourable Supreme Court. Admittedly in that case, the question that fell for consideration before CEGAT was whether the term "fertiliser" in the impugned exemption notification covered chemical fertiliser like molten urea or was confined only to soil fertiliser. Though molten urea usually a chemical fertiliser was not disputed by either side, but even then the CEGAT persuaded itself to hold to the effect that molten urea was not fertiliser at all. Thus the honourable Supreme Court found it difficult to appreciate how a third case could be made out by the CEGAT in the absence of such pleading by any side. Learned State Representative submits that the facts of the case are otherwise here and he has objection to the expression used by the petitioner namely "blowing hot and cold" and "playing fast and loose". He submits that no decision has yet been rendered and by the supplementary affidavit only an alternative plea has been raised and the respondent-defendant has every right in law to make out an alternative plea before the final h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dia. The two requirements of section 5(3) are that (I) such sale or purchase of the goods should take place after the agreement or order for or in relation to their export and (II) that such sale or purchase must take place for the purpose of complying with such agreement or order entered into with the foreign buyers. If such last sale or purchase was made before the date of such agreement or order, it cannot be deemed to be in the course of their export. The penultimate sale preceding the export sale is not exigible to State taxation here on fulfilment of the above conditions. To effectuate this provision of the Central Act, a specific provision has been made in section 5(2)(a)(v) of the Bengal Finance (Sales Tax) Act, 1941 providing to the effect that such sales which are shown to the satisfaction of the authority here to have taken place in the course of export are to be allowed deduction fully from turnover tax. But difficulty of the problem crops up only after reading rule 27C with rule 27AA of the Rules, 1941 framed under section 26 of the Act of 1941 requiring the purchasing dealer to furnish declaration in form XXXIII ensuring that no single declaration in that form shall c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rulings cited refer to a certain fact-situation which is conspicuous by its absence here. In respect of both the cited cases one of the dealers' purchasing was from outside the respective State of sale. So it was not possible for the selling dealer of West Bengal to produce the declaration signed by the Kerala purchasing dealer who is not a registered dealer here. In such a situation the Tribunal here held that even if the applicant failed to produce form XXXIII, the exemption claimed should be granted if satisfaction of the sales tax authority could be arrived at on the basis of other evidence produced to the effect that the sale was in the course of export. That view was taken by the Tribunal as no rule or law can force anyone to perform something which is impossible of performance. He emphasises the fact of the instant case where the seller and purchaser are both registered dealers under the Act of 1941. The goods were within the State when the transaction actually took place. The occasion of sale and purchase took place here. Form XXXIII was introduced in the Act of 1941 to enable the dealer to substantiate that though it apparently is an intra-State sale but actually it was a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 5(3) of the Central Sales Tax Act, 1956. Production of declaration form in form XXXIII has already been decided to be not compulsory by this Tribunal in case of sale by dealer here to a purchasing dealer in another State in the course of export. It was held that the tax authorities must not demand always production of a declaration in form XXXIII. The language of rule 27C(2) also does not indicate that demand of such declaration is mandatory. It appears that the assessing officer against whose order D.C. passed the order in suo motu revision gave clearance to the entire transaction as export sale. The D.C. also held indirectly at least that the first transaction in each of these purchase orders was export sale. It is to be considered as to whether the D.C.'s action disallowing those other transactions as not export sale only on the basis of non-compliance of declaration of form XXXIII was a step in right direction, when there was admittedly no other material to show those were not export sales. To put it in a different way, an answer is needed on the question of competence of the State authority under section 13(3) and 13(4) of the C.S.T. Act to provide that a single declaration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the court is of opinion that it was not within the competence of the State authorities under section 13(3) and 13(4) of the C.S.T. Act to provide that a single declaration covering more than one transaction shall not be made. The judgement of the Supreme Court is binding on all the courts under article 141 of the Constitution of India. Even if the pronouncement of such principle was not necessary for the decision of the case, the principle of law enunciated by the Supreme Court even by way of obiter dicta, must be taken to be the law declared by the Supreme Court. [AIR 1969 Raj 192 [FB] at 208 (Jeevraj v. Lalchand)]. 15.. That being the position of law we cannot but hold that the State Legislature has no competence to enunciate such form XXXIII to provide contrary to the Central Act and rules that a single declaration covering more than one transaction shall not be made. If conditions given in form XXXIII are made to stand as the only proof of export sale, I am afraid, that by imposition of tax on such sales, as has been done in this case, mandate of article 286 of the Constitution will be infringed. It appears that it is only for avoiding any future complications, the hono ..... X X X X Extracts X X X X X X X X Extracts X X X X
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