DINESH MAHESHWARI,J. - (1.) Preliminary and brief outline. These appeals by special leave are directed against the common judgment and order dated 18.12.2014 in Writ Petition Nos. 2552 of 2013 and 6258 of 2013 whereby, the High Court of Judicature at Hyderabad for the State of Telangana and the State of Andhra Pradesh[1] upheld the assessment orders dated 20.01.2010 and 18.05.2010 passed by the Commercial Tax Officer, Chinawaltair Circle[2] and held that the transactions in question were not the sales in the course of import but had been inter-State sales, liable to Central Sales Tax; and denied the exemption claimed under Section 5(2) of the Central Sales Tax Act, 1956[3] while granting time to the appellant to produce the prescribed C-Forms to the assessing authority for availing the benefit of concessional rate of tax. [1] Hereinafter referred to as 'the High Court' [2] Hereinafter referred to as 'the CTO'. [3] Hereinafter referred to as 'the CST Act'.
(2.) We may usefully observe at the outset that, in all, seven transactions of similar nature form the subject matter of these appeals; one relating to the assessment for the year 2005-06 and others relating to the assessment for the year 2006-07. The common salient features of all these transactions had been that they were for supply of timber from a foreign country and were allegedly executed in a similar fashion thus: The supplier (party number 1) sold the goods in question to the first buyer (party number 2) and delivered them at the port of shipment. Thereafter, while the goods were in transit on high seas, party number 2 transferred the goods to the appellant (who was invariably party number 3 in these transactions) by endorsing the bill of lading in favour of the appellant. Further to this and while the goods were on high seas, the appellant allegedly transferred them to the end-buyer (party number 4) by endorsing the bill of lading in favour of the end-buyer. 2.1. However, in each of these transactions, when the goods in question reached the port at Visakhapatnam (also known as Vizag), the appellant carried out the proceedings envisaged by the Customs Act, 1962[4] and filed a bill of entry for warehousing and thereafter, filed another bill of entry for home consumption (ex-bond). Accordingly and on the basis of such bills of entry, the appellant was duly assessed for customs duty. The appellant later on raised debit notes on the end-buyers. [4] Hereinafter referred to as 'the Customs Act'.
(3.) With reference to the aforementioned transactions and the high seas sale agreements, the case of appellant had been that it had only acted as an agent of the end-buyers while filing the bills of entry; and the sales of the goods in question to the end-buyers, being the sales taking place in the course of import of goods into the territory of India, were eligible for exemption from payment of sales tax by virtue of Section 5(2) of the CST Act. However, in the assessment orders dated 20.01.2010 and 18.05.2010, the CTO denied the benefit of exemption to the appellant, particularly for the reason that the appellant cleared the goods from the customs after filing the bills of entry and later on raised debit notes, showing sales to the end-buyers. The CTO held that the goods in question had crossed the customs frontiers of India when the bills of entry were filed by the appellant and the goods were assessed to customs duty and hence, the sales effected by the appellant to the end-buyers could not be said to be high sea sales.;