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TMI Blog2010 (3) TMI 1019X X X X Extracts X X X X X X X X Extracts X X X X ..... sts of the Revenue. The earlier assessment orders passed by the Assistant Commissioner of Commercial Taxes, Satna, accepting the F forms and the claim of stock transfer under the CST Act were set aside and the matter remanded to the assessing officer for passing fresh orders after site inspection of Dudhichua mines and on verification of the points mentioned in the order. While passing the order, the Additional Commissioner observed thus: The cost of entire sold goods has been shown as f. o. r. loading point. It does not become clear from the facts and three agreements annexed with the case that this agreement is entered into by the mines situate at Madhya Pradesh or on behalf of the Dudhichua Mines situated in Uttar Pradesh. Transfer of stock at a distance of one and a half kilometre cannot be disbelieved looking to the superficial anatomy of local area and conveniences, the transfer of goods by the company through M. G. R. system and arrangement of weighment. Both of these points are the points of verification, whereon it is not possible to take a decision at the stage of revision. But so far as the aforesaid question of transportation of the goods from one State to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner being not liable for interference, all the abovementioned appeals submitted before me are dismissed. To say the least, the manner of disposal of the appeal is most unsatisfactory. The relevant facts necessary for the disposal of appeals can be gathered from the minutes of the meeting held at Dudhichua on October 13, 2004 in which the commercial taxes officials concerned held discussions with the finance manager of the appellant. It is recorded therein: Dudhichua mine falls in M.P. and U.P. States. M.P. mine is controlled by west section and U.P. mine is controlled by east section of Dudhichua Project. The demarcation of State boundary (Ballia Nallah) signed by the State authorities and map is also presented. Dudhichua mine is not linked to any power house, and it is operating as a basket mine. Dudhichua is supplying coal to the power houses to make up the shortage of linked mines. The M.P. coal is mined and transferred (as per trip sheet) to coal stock yard located in U.P., where the U.P. coal is also dumped, through our own dumpers, the M.P. coal is mixed with U.P. coal and it is rather impossible to segregate M.P. and U.P. coal. From stock yard to crusher poin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e State to another. In the present case, we are not concerned with the second limb of section 3, i.e., clause (b). The interpretation of clause (a) of section 3 came up for consideration before the Supreme Court in a series of cases. Clause (a) of section 3 was explained thus in the leading case of Tata Iron Steel Co. Ltd. v. S.R. Sarkar [1960] 11 STC 655 (SC) (at page 667): . . . clause (a) of section 3 covers sales, other than those included in clause (b), in which the movement of goods from one State to another is the result of a covenant or incident of the contract of sale, and property in the goods passes in either State. In Commissioner of Sales Tax, U.P. v. Bakhtawar Lal Kailash Chand Arhti [1992] 87 STC 196, the Supreme Court explained the scope of section 3(a) in the following words (at page 200): According to clause (a) of section 3, an inter-State sale or purchase is one which occasions the movement of goods from one State to another. In other words, the movement of goods from one State to another must be the necessary incident the necessary consequence of sale or purchase. A case of cause and effect the cause being the sale/purchase and the effect be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... integrated that the connection between the two cannot be voluntarily interrupted without a breach of the contract or the compulsion arising from the nature of the transaction. To occasion export there must exist such a bond between the contract of sale and the actual exportation that each link is inextricably connected with the one immediately preceding it. The principle thus admits of no doubt, according to the decisions of this court, that the sales to be exigible to tax under the Act must be shown to have occasioned the movement of the goods or articles from one State to another. The movement must be the result of a covenant or incident of the contract of sale. In Ben Gorm case [1964] 15 STC 753 (SC), the distinction between a sale for export and a sale in the course of export was highlighted. We may also refer to section 6A of the CST Act which deals with burden of proof as it stood at the relevant point of time: 6A. Burden of proof, etc., in case of transfer of goods claimed otherwise than by way of sale. (1) Where any dealer claims that he is not liable to pay tax under this Act, in respect of any goods, on the ground that the movement of such goods from one State ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... revisional authority himself is not clear whether the transportation of coal from M.P. to U.P. was by way of stock transfers or inter-State sales. What all is stated in the revision order is that the facts have to be verified fully. That means, the order of the assessing authority granting exemption under the CST Act has been set aside not on the basis of concrete findings but on the basis that further inquiries might reveal material contradicting the claim of the appellant. Unless the order sought to be revised is found to be erroneous on a particular ground or on the basis of definite material, the revision could not have been resorted to. The revision cannot be initiated on mere surmise or possibility of gathering more material by directing further inquiry. Viewed from another angle, the initial burden cast on the dealer having been discharged by filing F forms as per the rules, there must be sufficient basis to rebut the initial presumption that arises in favour of the assessee. Thus, on this short ground, the revision order cannot be justified in law. Even otherwise, the facts of the case reveal that it cannot reasonably be said that the coal has been moved from M.P. Du ..... X X X X Extracts X X X X X X X X Extracts X X X X
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