- (1.) THE Sales Tax Tribunal, Haryana, Chandigarh, had referred the following question for the opinion of this Court under Section 42 of the Haryana General Sales Tax Act, 1973, at the instance of the assessee-company : "whether, on the facts and in the circumstances of the case, the Sales Tax Tribunal, Haryana, was right in law in holding that the sales tax authorities had correctly treated the stock transfers of the value of Rs. 75,11,460 from its factory at Sonepat to the Rajpura depot of its Patiala branch as exigible to Central sales tax as inter-State sales ?"
(2.) THE brief resume of facts for understanding the controversy is as under : The assessee-company manufactures various electrical equipments including transformers at its factory located at Sonepat in Haryana State. The head office of the company is located at Delhi. The company had branch offices at Rajpura in Punjab and at other places. It is a registered dealer both under the Punjab General Sales Tax Act, 1948 (as applicable to the State of Haryana) (hereinafter referred to as "the State Act") and the Central Sales Tax Act, 1956. The Punjab State Electricity Board (hereinafter referred to as "the Board") placed orders for the supply of 750 and 3,100 transformers vide their purchase orders dated 16th December, 1969 and 29th June, 1970, respectively. Copies of these orders are annexures A-l and A-2. The terms and conditions of both these purchase orders are identical. The said transformers were manufactured at Sonepat factory and thereafter were shown as transferred to the Rajpura branch of the company before being handed over to various offices of the Electricity Board in Punjab. The modus operandi of the company was that after the manufacture of the transformers at Sonepat, these were despatched to the company branch office at Rajpura for treating the transformers in order to make them ready for delivery as under : (a) Filling up transformers with oil (required for cooling of transformer ). (b) Fixing of copper thimbles (required for connecting overhead line to the transformer bushing terminals ). (c) Fixing of arcing horns (required for protection of transformer against lightning ). (d) Fixing of silicagel breathers (required for permitting breathing in and out during the expansion and contraction of oil ). (e) Fixing of name-plates (giving details regarding the capacity, voltage, etc. , of the transformer ).
(3.) THE assessee-company supplied 990 transformers to its Rajpura depot of Patiala branch during the assessment year 1970-71 at a total price of Rs. 75,11,460. Before the Assessing Authority, the dealer claimed the exemption from payment of Central sales tax on the ground that goods were moved from the factory to its Rajpura branch by way of branch transfers and not in pursuance of the contract of sale. The Assessing Authority, however, after examining the terms and conditions of the purchase orders concluded that the movement of the transformers from the factory at Sonepat was in pursuance of the contract of sale entered into by the assessee with the Electricity Board. In coming to this conclusion, the Assessing Authority mainly relied on para 20 (b) of the purchase order providing certain tests to be performed by the assessee-company in its factory in the presence of a nominee of the Electricity Board before their despatch. It was also held that the above referred accessories required to be fitted with the transformers were only ancillary in nature and that it cannot be said that the transformers were partially manufactured till the accessories were fitted. The factum that the assessee-company had to give an advance notice to the Board before despatching the transformers from its factory at Sonepat in order to enable the Board to arrange purchase money also weighed with the Assessing Authority in coming to this conclusion. Aggrieved against the order of the Assessing Authority, the assessee filed an appeal before the Deputy Excise and Taxation Commissioner (Appeals) under Section 9 (2) of the Central Sales Tax Act read with Section 39 (1) of the Haryana Act. The Deputy Excise and Taxation Commissioner (Appeals) also upheld the findings of the Assessing Authority vide his order dated 19th April, 1976. The assessee then filed second appeal before the Sales Tax Tribunal, Haryana. The Tribunal also dismissed the appeal of the assessee vide its order dated 18th April, 1980, except allowing the assessee an opportunity of submitting C form for claiming some concession in the rate of tax. The case was remanded to the Assessing Authority for affording opportunity to the company to furnish requisite forms and proceeding further in accordance with law.;