9911796707
TMI Blog2009 (11) TMI 825X X X X Extracts X X X X X X X X Extracts X X X X ..... r the Bihar Act during the period in question, namely, 1995-96. A brief statement of facts essential for the disposal of this writ petition may be indicated. Nepal is a sovereign, independent land-locked country, and shares a long length of boundary with India. In order to arrange supply of the goods in question, the Government of Nepal entered into a treaty with the Government of India for export of the same from India to Nepal on the terms and conditions mentioned in the treaty (annexure 6). The petitioner is a public sector undertaking of the Government of India, the entire shares of which are held by the President of India and the official nominees. It is an instrumentality of the Government of India and is engaged in the manufacture, production, storage and sale of the products in India. Its counterpart body is Nepal Oil Corporation (hereinafter to be referred as the NOC), an instrumentality of the Government of Nepal. In view of terms of the treaty, the actual duty of export of the products from India to Nepal has been entrusted to IOC, and the duty of import in Nepal has been entrusted to NOC. The treaty was followed by an agreement between IOC and NOC executed on June 27, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iew of the relevant provisions of law discussed hereinafter. The special procedure prescribed for a transaction of the present nature has been completely over-looked. The materials placed on record by the petitioner is adequate to prove the factum of exports, as well as the quantification of it. He further submits that the authorities have failed to realise that they have made a departure only for the three periods in question. He next submits that it is a transaction on nation-to-nation basis, the actual implementation has been entrusted to the two public sector undertakings, and the entire payments have been made by account payee cheques. The learned Advocate-General submits that certain provisions of the Central Excise and Salt Act read with the Rules thereunder, the Customs Act, and the Bihar Act have to be read to ascertain the exact procedure applicable in the present case. He further submits that the State Government would not insist on a hyper-technical approach of production of bills of export or its substitute procedure, but it would not be right to completely give up scrutiny to obviate chances of misdeeds at the hands of unscrupulous elements. Other evidence of reliabl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any class of dealers or any purchase or category or description of purchases of such goods. (4) Where exemption from the levy of tax under this part on any sale or purchase of goods is claimed by a dealer under the provisions of this section or section 21, the burden of proof shall lie on such dealer and the prescribed authority may require the dealer to substantiate the claim in the prescribed manner." The present case is covered by section 7(1)(c) of the Act which provides that no tax shall be payable under this part on sales in the course of export of the goods out of the country of India. In the totality of the circumstances, we are convinced that the total exports of the products in question effected by IOC to NOC during the period in question are covered by the terms of the article 286 of the Constitution of India read with section 7 of the Bihar Act and, therefore, is exempted from payment of taxes under the Bihar Act. This takes us on to the more vital aspects of the matter in the present case, namely, whether or not the bills of export or its substitute procedure formulated for export of the products in question from India to Nepal is imperative, and whether or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e exported by land, a bill of export in the prescribed form. (2) The exporter of any goods, while presenting a shipping bill or bill of export, shall at the foot thereof make and subscribe to a declaration as to the truth of its contents." In view of the terms of the agreement inter parties (annexure 4), read with sub-rule (2) of rule 13, the procedure/system of bill of export has been substituted by the detailed procedure indicated in the agreement. It appears that six copies of the substitute bills of export have to be prepared, and have to pass through various authorities in India as well as in Nepal in proof of the transaction including the quantum of exports. Copies of the documents have to pass through the authorities in the following manner: Distribution of Nepal invoice First copy Second copy Third copy Fourth copy Fifth copy Sixth copy Presented before C. Ex Officer-in-Charge of warehouse/endorsed copy sent to Indian Land Customs Station Officer thru exporter/after endorsement sent to Nepalese Customs Officer/Nepalese Custom Officer shall deal with the same as directed by his Majesty Government of Nepal Presented before C. Ex Officer-in-Charge of warehous ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ature of the transaction, namely, it is sale in course of export, is not in doubt. We also notice from a perusal of the three orders in question that the learned authorities have not applied themselves to the merits of the materials produced by IOC, and have rejected the petitioner's claim for exemption outright on the ground of non-production of the bills of export. We are, therefore, of the view that the impugned order is not sustainable in law. In the result, we set aside the impugned order dated March 4, 2005 (annexure 3), passed by the Commercial Taxes Tribunal, Bihar, Patna, in Revision Case No. PT-430/00 & PT-430A/00. The matter goes back on remand to the learned assessing officer who shall apply himself to the merits of the claim of exemption raised by the petitioner in accordance with law, the observations made hereinabove, and without insisting on production of the substitute bills of export. It will be open to IOC to place further materials, if any, in their possession, in support of their claim, for example, the bank transactions and the documents marked, annexure 8 series and 9 series. They are obliged to examine the correctness of the figures returned by t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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