Girija Jagannath, Member (A) -
(1.) THIS is an appeal against the orders of the Appellant Deputy Commissioner (CT) Secunderabad Division, Hyderabad, in proceedings Appeal No. 5/93 -94, dated 16.2.1994 partly dismissed the appeal preferred against the orders of the Commercial Tax Officer, Nampally circle, Hyderabad, in Asst. No. 26012/88 -89/CST dated 23.2.1993. Appellant is a dealer in machinery and air -conditioning and was assessed on gross and net turnovers of Rs. 39,88,049 -00 and Rs. 15,48,589 -00 Ps. respectively. On appeal, the Appellate Deputy Commissioner, confirmed the levy of tax at 10 percent on a turnover of Rs. 5,36,736 -00 Ps., relating to transit sales which was resulted in the present appeal.
(2.) THE point to be considered is whether the disputed turnover of Rs. 5,36,736 -00 Ps., relating to transit sales is liable to tax under the C.S.T. Act? The Commercial Tax Officer, noticed that the sale value relating to certain transit sales was less than the purchase value for which he noted the purchase bill number and value thereof and corresponding sale value. The total of the impugned purchases covered by seven purchase bills made against 'E' forms was Rs. 6,77,670/ - as against the corresponding sale value of Rs. 3,44,195. He therefore added gross profit at 30 percent to the purchase value of Rs. 6,77,670/ - and arrived at the sale value of Rs. 8,80,971/ -. When the corresponding sale value disclosed in the corresponding sale bills, amounted only to Rs. 3,44,195/ -. He therefore levied tax on the difference in sale amount of Rs. 5,36,776/ - which is the disputed turnover in the present appeal. The Appellate Deputy Commissioner upheld the findings of the Commercial Tax Officer, and rejected the contention of the appellant that there was excavation in the purchase price of some items as compared to the agreed sale price with the customer. Appellate Deputy Commissioner, observed that the appellant did not adduce any evidence to prove this claim. Accordingly, he dismissed the appeal on the impugned turnover.
(3.) BEFORE us, it is contended that the impugned transactions related to sales of L.Rs by endorsement which are eligible for exemption under section 6(2) of the C.S.T. Act irrespective of the price charged in the sale bills issued by the appellant. (Counsel for the appellant pleaded that goods were supplied to public companies and corporations and the appellant was sometimes forced to supply material as per the rates fixed at the time of taking the order irrespective of the price at which they were purchased on subsequent dates. More importantly the counsel for the appellant submitted a detailed chart giving particulars of purchase bill, amount thereof, L.R. number and date, 'C' form numbers, E1 form numbers, sale bill number, customers' name and value of the bill. From this statement, he pointed out that supplies were made to three parties viz., the V.S.R Ltd., Vizag, Hyderabad Allwyn Limited and Oil Country Tabular Limited. He also submitted an abstract of sales to each party and details of the relevant purchases made. These particulars are as follows: - -
He argued that sale bills were being issued in an ad hoc manner to each party and that strictly comparison could not be made between the sale value and the relevant purchase value. If the aggregate sale value of all the bills in favour of one customer was compared to the aggregate of the relevant purchases, there was no such discrepancy as pointed out by the Commercial Tax Officer. In any case, even if there was a difference in the sense that the sale value was lesser than the purchase value, the sales being undisputedly transit sales, no tax could be levied. He thus concluded his arguments.;