Decided on April 23,1962



Desai, J. - (1.)The petitioners, who are manufacturers of foot-wear purchased rubber from certain dealers residing in the State of Cochin. In their assessment for sales tax for the period from 1st April, 1954, to 31st March, 1955, these purchases were subjected to tax on the ground that they came within the purview of section 10(a) of the Bombay Sales Tax Act of 1953. The petitioners' contention before the Sales Tax Authorities was that section 10(a) had no application to the transactions in question because they were purchases made from dealers outside the State and clause (a) of section 10 could only apply when the transactions were from unregistered dealers within the State of Bombay. According to the petitioners the only provision in the Sales Tax Act of 1953, which could have application to the present transaction was the provision of section 10C, but since rubber was not one of the items of goods specified by the State Government by notification as required by the said section, section 10C also could not apply to the case. This contention was negatived by the Sales Tax Authorities. Another contention which was raised by the petitioners was that the transactions in the present case had taken place outside the State of Bombay and were, therefore, not taxable. This contention also was negatived by the Sales Tax Authorities. In the revision application before the Sales Tax Tribunal both these contentions were again urged but were negatived by the Tribunal as well. Then at the instance of the petitioners the Tribunal drew up a statement of the case and referred to this Court the following two questions under section 34 of the Sales Tax Act of 1953 : (1) Whether on the facts and circumstances of the case the property in the rubber consignments passed to the applicant in Cochin, i.e., outside the State of Bombay ? (2) Whether the purchase tax under section 10(a) is leviable in respect of the purchases in dispute ?
(2.)Now, the facts found in connection with the first question are that the Cochin sellers had their agents in Bombay, who had taken the applicant's order and arranged for the shipping of the goods. In accordance with these orders goods were shipped by the Cochin sellers from Cochin to Bombay. The bills of lading were in the name of the sellers as consignors and consignees. The invoice, however, showed that the goods were shipped at the "risk and on account of M/s. Carona Sahu and Company (P.) Ltd." The insurance charges were borne by the buyers and they also paid the freight and other charges. The bills of lading were sent by the sellers through the bank to be delivered to the buyers in Bombay on payment of the price of the goods. In view of these facts the Tribunal's conclusions were that since orders were accepted on behalf of the sellers in Bombay, the contracts had been entered into in Bombay and since the bills of lading were in the name of the sellers as consignors and consignees and delivered to the buyers in Bombay on payment through the bank, the property in the goods was intended by the parties to pass in Bombay. The indorsement in the invoice that the goods wore being shipped "on account of and at the risk of the buyers" did not, according to the Tribunal, mean anything more than that the insurance charges were to be paid by the buyers. In our opinion, the conclusion arrived at by the Tribunal on the facts found by it is correct and no error of law can be said to have been committed by it. Since the property in the goods, as correctly held by the Tribunal, passed in the State of Bombay, the answer to the first question must be in the negative.
(3.)Coming now to the next question, the argument of Mr. Donde, the learned Advocate appearing for the petitioners, is that section 10(a) can have no application to the purchases in question because the purchases are not made from a person such as contemplated by the said provision. Section 10 in so far as is material provides :
"Subject to the provisions of section 7, there shall be levied a purchase tax on the turnover of purchases of goods specified in column 1 of Schedule B, at the rates, if any, specified against such goods in column 4 of the said Schedule, - (a) where such goods are purchased from a person who is not a registered dealer; ..................."

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