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TMI Blog2016 (1) TMI 872X X X X Extracts X X X X X X X X Extracts X X X X ..... gistration certificate is quashed as well as the order refusing to grant Form-C is also quashed. - Form-C to be issued - Decided in favor of assessee. In the light of the aforesaid provisions, it is apparently clear, that deep-freezers and tricycles are re-sold to the distributors and dealers of the petitioner in the same form and condition as a transfer on the right to use the goods. Such “transfer of the right to use the goods” is a “sale” as defined under the Central Sales Tax Act as well as under the VAT Act. The goods purchased by the petitioner as per the products indicated in the certificate of registration are clearly intended “for resale” by it and consequently, the petitioner is entitled for issuance of Form-C in order to avail concessional rate of tax. - Civil Misc. Writ Petition (Tax) No. 912 of 2015 And Civil Misc. Writ Petition (Tax) No. 911 of 2015 - - - Dated:- 8-1-2016 - TARUN AGARWALA AND VINOD KUMAR MISRA, JJ For the Petitioner : Piyush Agrawal For the Respondent : C.S.C. ORDER Per: Tarun Agarwala ,J. 1. The petitioner is a Limited Company incorporated under the Companies Act, 1956 and is engaged in the business of purchase and sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch the petitioner deposits the due taxes as and when it is due. 4. On the strength of the registration certificate granted under Section 8(3)(b) of the Act the petitioner applied for issuance of Form-C under the VAT Act in June 2014, but for the reasons best known to the assessing authority, Form-C was not issued. The petitioner was compelled to file Writ Petition No.543 of 2015, which was disposed of by an order dated 9.7.2015 directing the assessing authority to pass an appropriate order in accordance with law on the petitioner's application for grant of Form-C. Instead of issuing Form-C, the petitioner received two show cause notices dated 5.8.2015 under Section 7(4) and Section 8 of the Act to show cause why the registration certificate should not be amended and deep-freezers and tricycles should not be deleted from the registration certificate. On receipt of the aforesaid notices the petitioner filed a detailed reply indicating that the deep-freezers and tricycles are being purchased for giving them on lease and in view of Section 2(g)(iv) of the Act the said items could be given on lease as transfer of right to use the goods which is deemed to be a sale. The petitioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... using to issue Form-C. The learned counsel submitted that the impugned order could only be prospective and could not apply to pending applications and, therefore, Form-C in any case should have been issued on those applications which were pending prior to the date of passing of the impugned order. 9. On the other hand, Sri C.B.Tripathi, the learned special counsel for the State submitted, that the Deputy Commissioner had all powers under Section 7(4)(a) of the Act to amend the registration certificate. In the instant case the authority found that the goods mentioned in the registration certificate were not meant for resale in the same form and, therefore, the authority was justified in amending the registration certificate. The learned counsel submitted that under Rule 12(7) of the Central Sales Tax Rules, the Forms are required to be furnished by the assessing authority within three months or such extended period as the authority deems fit. In the instant case, Form-C for the assessment years 2010-11 and 2011-12 and 2012-13 has been requested which has become belatedly barred by limitation and, consequently, no mandamus could be issued for issuance of Form-C for such period. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n referred to in Section 8(3) of the Act shall be liable to pay tax under this Act at a concessional rate. Section 8(3) of the Act contends that the goods referred to in sub section (1) of Section 8 of the Act would be such goods as specified in the certificate of registration which are intended for resale which would be subjected to concessional rate of tax. For facility, Section 8(1)(2)(3) and (4) of the Central Sales Tax Act are extracted hereunder:- 8. Rates of tax on sales in the course of inter-State trade or commerce,-- (1) Every dealer, who in the course of inter-State trade or commerce, sells to a registered dealer goods of the description referred to in sub-section (3), shall be liable to pay tax under this Act, which shall be three per cent of his turnover or at the rate applicable to the sale or purchase of such goods inside the appropriate State under the sales tax law of that State, whichever is lower: PROVIDED that the Central Government may, by notification in the Official Gazette, reduce the rate of tax under this sub-section. (2) The tax payable by any dealer on his turnover in so far as the turnover or any part thereof relates to the sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e word resale has not been defined under the Central Sales Tax Act. However, the word sale has been defined under Section 2(g) of the Act. For facility, Section 2(g) of the Act is extracted hereunder: 2. (g) sale , with its grammatical variations and cognate expressions, means any transfer of property in goods by one person to another for cash or for deferred payment or for any other valuable consideration, and includes, 16. A perusal of the aforesaid definition of sale includes a transfer of the right to use any goods for any purpose. The word sale has also been defined under Section 2(ac)(iv) of the VAT Act. For facility, the said provision is extracted hereunder: 2(ac) sale with its grammatical variations and cognate expressions, means any transfer of property in goods (otherwise than by way of a mortgage, hypothecation, charge or pledge) by one person to another, for cash or for deferred payment or for any other valuable consideration and includes, (iv) a transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration. A perusal of the said provision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of goods sold; (iii) Sale price of goods in relation to transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract, shall be determined after deducting the aggregate of actual amount incurred towards labour and services, amount of profit relating to supply of labour and services and such other amounts as may be prescribed from the total amount received or receivable in respect of such works contract; (iv) In respect of transfer of right to use goods, any goods for any purpose (whether or not for a specified period) sale price means the valuable consideration received or receivable in respect of such transfer of right to use goods but does not include any sum payable as a penalty or as compensation or damages for breach of contract; (v) Tax charged or chargeable shall not form the part of the sale price; (vi) Cash or trade discount at the time of sale as evident from the invoice shall be excluded from the sale price but any ex post facto grant of discounts or incentives or rebates or rewards and the like shall not be excluded from the sale price; 20. Section 2(h) of the VAT Act defines dealer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment or other valuable consideration shall be computed on taxable turnover. For the purpose of determining the taxable turnover of sale of such goods, the amounts specified below shall be deducted if they are included in the gross turnover- (a) the amount representing the amount receivable in respect of transfer of right to use any exempt goods; (b) amount receivable as penalty for defaults in payments or as damages or any loss caused to the goods by the person to whom such transfer was made; (c) amount receivable in respect of transfer, delivery or supply of goods under the contract or agreement of transfer of right to use goods for any purpose where such transfer, by the lessor to the lessee, is made as a result of a sale (i) in the course of inter-state trade or commerce; or (ii) outside the State; or (iii) in the course of export of the goods out of the territory of India or in the course of import of goods into the territory of India. 23. From a perusal of the Section 3 read with Rule 10 of the Rules, it is absolutely clear that the transfer of right to use any goods is considered to be a sale and any amount received as lease ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmanding the respondents to issue Form-C. Similarly a mandamus was issued in OMIL-JSC-JV vs. Union of India and others, (2013)61 VST 370. 28. We also find that the Deputy Commissioner committed a manifest error in rejecting the petitioner s application for issuance of Form-C, on the ground that the registration certificate has been amended. We are of the opinion that the amendment made in the registration certificate could not apply retrospectively and the order, if any, could only apply to an application filed after the amendment. Applications which are pending prior to the amendment of the registration are required to be considered as if the registration certificate had not been amended. The authority, therefore, committed a manifest error in rejecting the petitioner s application for issuance of Form-C on the ground that the certificate had been amended. The Supreme Court in M/s Sivalik Collulose Ltd., Gajraula, District Moradabad and another vs. State of U.P. and others, 1992 UPTC 1, held that the action under Section 7(4) of the Central Sales Tax Act by the authority granting the certificate of registration can only be prospectively and cannot operate retrospectively is ful ..... X X X X Extracts X X X X X X X X Extracts X X X X
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