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TMI Blog2015 (6) TMI 303X X X X Extracts X X X X X X X X Extracts X X X X ..... urchasing dealer is found to have indulged in misutilisation. The assessee explained in the proceedings under Section 23(3) of Delhi Sales Tax Act that the sale transactions herein were relatable to purchase order dated 27.06.2000. It is not the case of the Revenue that the ST-35 form is a fabricated document. Concededly, it was issued by the sales tax department of GNCTD to the purchasing dealer who is registered for such purposes with the concerned authorities. There is nothing to show that the selling dealer (the assessee) could have known as to for which assessment year the specific form had been issued by the department. For his purposes, the endorsement on the top showing it to be a form pertaining to AY 2000-01 was sufficient. The mere fact that the form when handed over did not bear a specific date is inconsequential and from this complicity of the assessee cannot be inferred. - deduction of the value of the transaction represented by the ST-35 form has been wrongly disallowed by the Tribunal and the authorities below. - Decided in favour of assessee. - ST Appeal No. 78/2012 - - - Dated:- 23-3-2015 - S Ravindra Bhat And R K Gauba, JJ For the Appellants : Ms Prem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ginal return submitted by the assessee and at the time of assessment proceedings arising therefrom, there was no reference made to the ST-35 form or to the purchase order dated 27.06.2000. 7. The assessing authority proceeded under Section 23(3) of Delhi Sales Tax Act and, by order dated 28.09.2002, disallowed exemption claim with regard to the transaction represented by the ST-35 form, raising a demand of sales tax along with interest on such account. The copy of the remanded assessment order dated 28.02.2005 further reflects, and again there is no contest in this regard on the side of the appellant, that the assessing authority had called for verification report from the concerned ward, the report dated 03.09.2002 submitted whereupon reflected that the purchasing dealer s activities were doubtful . 8. On appeal, the first appellate authority remanded the matter by order dated 03.03.2003 with directions that the matter be re-considered after the assessee had been confronted with the reasons for which the claim founded on the ST-35 form was being rejected. 9. As indicated earlier, the assessing authority passed a fresh order on 28.02.2005 (remand order) reiterating the re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered dealer- (A) of goods of the class specified in the certificate of registration of such dealer, as being intended for use by him as raw materials in the manufacture in Delhi of any goods, other than specified in the Third Schedule or newspapers,-- (1) for sale by him inside Delhi; or (2) for sale by him in the course of inter-State trade or commerce, being a sale occasioning, or effected by transfer of documents of tile to such goods during the movement of such goods from Delhi; or (3) for sale by him in the court of export outside India being a sale occasioning the moveable of such goods from India Delhi, or a sale effected by transfer of documents of title to such goods effected during the moveable of such goods from Delhi, to a place outside India and after the goods have crossed the customs frontiers of India; or (B) of goods of the class or classes specified in the certificate of registration of such dealer as being intended for resale by him in Delhi, or for sale by him in the court of inter-State trade or commerce or in the course of export outside India in the manner specified in sub-item (2) or sub-item (3) of item (A), as the case may be; and (C) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ication under Section 8 has been issued. 16. Section 8 of Delhi Sales Tax Act clarified that the authorities under the law were not authorized to impose a tax on any sale or purchase of goods when such sale or purchase takes place (i) in the course of inter-State trade or commerce; or (ii) outside Delhi; or (iii) in the course of import of the goods into or export of the goods out of, the territory of India. 17. The department of Trade and Taxes of the Govt. of NCT of Delhi had issued instructions by circular No. 7 of 1995-96 dated 23.06.1995 (hereafter referred to as the circular ) in terms of Section 4 of Delhi Sales Tax Act read with rule 11 (XXXIV-A)(i) of Delhi Sales Tax Rules. The Tribunal, in its order, noted clauses (iv) and (vii) of the said circular as under:- (iv) the dealer shall file along with his application a list of his complete requirement of the type of statutory forms for full 1 year, based on the bills/invoices (to be produced in original before the assessing authority for checking) and he would be entitled to have his full quota of forms in one go, unless the AA has specific reasons to deny the full quota for reasons to be recorded in writing. (v ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessing authority. The present appeal arises out of the fresh assessment order passed after the remand. 20. We do not find any substance in the reasoning that the purchase order was suspect because it was intended to be valid for three and half months. There is no hard and fast rule or norm as to the validity of purchase orders. It is a matter of commercial expediency and mutual understanding between the two dealers. 21. In the case of State of Madras v. M/s. Radio and Electricals Ltd. Anr. (1996) 18 STC 222, questions as to the onus to explain had arisen, albeit in the context of similar provisions of Central Sales Tax Act, 1956, observations whereupon of the Supreme Court are germane to the issue at hand and, thus, may be quoted as under:- The Act seeks to impose tax on transactions, amongst others, of sale and purchase in inter-State trade and commerce. Though the tax under the Act is levied primarily from the seller, the burden is ultimately passed on the consumers of goods because it enters into the price paid by them. Parliament with a view to reduce the burden on the consumer arising out of multiple taxation has, in respect of sales of declared goods which ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) shall be allowed unless a true declaration in the prescribed form duly filled and signed by a dealer is furnished to the selling dealer. The last proviso is also of immense import as it specifies that where goods are not utilized by the purchasing dealer for the purposes mentioned in Sub-clause (v), the price of such goods shall none the less be deductible from the turnover of the selling dealer and instead, shall be included in the taxable turnover of the purchasing dealer. It indicates that the selling dealer is not responsible for ensuring that goods are used for the purpose for which they are sold. Such an investigation would be carried out by the Department and if misutilisation is detected, the value of the transaction will be added to the account of the purchasing dealer. Section 6 of the Act explicitly places the burden of proof on the selling dealer if its case is that any sale is not liable to the payment of tax; this provision rubs against the grain of the petitioners' contentions. (emphasis supplied) 23. Relying, inter alia, upon the aforementioned cases, a Division Bench of this Court, of which one of us (S. Ravindra Bhat, J.) was a member, concluded in th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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