G. S. SINGHVI, J. - (1.) THESE two sales tax revision applications have been filed against the order of Board of Revenue dated November 30, 1985, whereby the Board of Revenue accepted the revision petitions filed by the non-petitioner, M/s. Hindustan Copper Limited, under section 14 (2) of the Rajasthan Sales Tax Act, 1954 (for short "the Act"), read with section 9 (2) of the Central Sales Tax Act, 1956 (for short "the Central Act"), against the two separate orders - one passed by the Deputy Commissioner (Appeals-II), Commercial Taxes, Jaipur and the other passed by the Deputy Commissioner (Appeals-I), Jaipur, on April 1, 1983. Common question of law are involved in both the revision petitions and, therefore, I deem it appropriate to decide both the revision petitions by a common order.
(2.) IN brief, the facts of the case are that M/s. Hindustan Copper Limited, Khetri, is a Government of INdia undertaking being a company registered under the Companies Act. It is having copper mines in the State of Rajasthan at Khetri, Dariba, Rajpura, Kolihan and Chandmari. It has also got mines in the State of Bihar at Ghatshila and in the State of Madhya Pradesh. Main activity of the company relates to exploration, prospecting and mining of minerals (copper in particular), extraction and fabrication of metals and manufacture of copper and alloys like brass in various forms including sheets and strips. The copper ore extracted from the mines is sent to the concentrator plant where percentage of copper is increased by the process of conspiration. Concentrated ore is then despatched to the smelting plant and the final product comes out in the form of sheets which are described as cathodes, rods (bars), etc. Commercial Taxes Officer, Special Circle, Bikaner, conducted a survey in October, 1981 and on the basis of this survey he concluded that the transaction of sending the goods to M/s. S. S. Metal Enterprises and Metal Rod (Pvt.) Ltd. , Delhi, appeared to be sales effected during the course of inter-State trade and commerce from Khetri. He then issued notices to the two dealers. The files were then transferred to the Commercial Taxes Officer, Special Circle IV, Jaipur, who issued notice under section 7b of the Act. After the non-petitioner filed its reply, the Commercial Taxes Officer, Special Circle IV, held that the transactions in question were made in the course of inter-State trade and commerce. He, therefore, made provisional assessment vide order dated March 1, 1982 and declared that a sum of Rs. 1,19,48,583. 67 was payable by the company. He also issued directions for issue of notice of demand. Against this order of provisional assessment, the assessee filed appeal under section 13 of the Act read with section 9 (2) of the Central Act. The Deputy Commissioner (Appeals-II), Jaipur, rejected the appeal of the assessee, vide order dated February 10, 1983. Then the assessee filed revision petition before the Board of Revenue which came to be registered as Revision Petition No. 88/83. Another order was passed by the assessing authority whereby levy of tax amounting to Rs. 1,59,45,349. 80 was assessed. Interest was also levied by the assessing authority. At the same time, it imposed a penalty and raised a total demand of Rs. 2,10,67,801. 43. Appeal filed by the assessee was partly allowed by the Deputy Commissioner (Appeals-I), Jaipur. Against this order of the Deputy Commissioner (Appeals-I), the assessee filed revision petition before the Board of Revenue, which came to be registered as Revision Petition No. 520/83. After hearing the parties at length, the Board of Revenue passed the impugned order dated November 30, 1985. In support of revisions, Shri Bapna, learned counsel for the petitioner, argued that the findings recorded by the Board of Revenue are perverse because the Board of Revenue has not only misconstrued the provisions of law but has also failed to take into consideration the material which was available before the assessing authority as well as the appellate authority and which was placed before the Board of Revenue. Shri Bapna argued that the assessment made by the assessing authority was perfectly in accordance with law because the movement of goods was occasioned in pursuance of the contract of sale. The contract of sale between the parties and the movement of goods from one State to another form part of one transaction, argued Shri Bapna. He submitted that copper is a controlled item and the Hindustan Copper Limited used to make bulk supplies to the purchasers from its Delhi depot. Shri Bapna, drew attention of the court to the procedure adopted by the assessee and pointed out that buyers were required to register their annual requirement in advance. The requirement of buyers used to be intimated to the factory, goods were sent from the factory to the depot at Delhi and then the same were disbursed from the Delhi depot. Shri Bapna invited the court's attention to the decision of the Supreme Court in State Trading Corporation of India Limited v. State of Mysore [1963] 14 STC 188 and argued that the procedure adopted by the non-petitioner must be construed as a contract of sale outside the State of manufacture. He also placed reliance on K. G. Khosla and Co. (P) Ltd. v. Deputy Commissioner of Commercial Taxes [1966] 17 STC 473 (SC), English Electric Company of India Ltd. v. Deputy Commercial Tax Officer [1976] 38 STC 475 (SC), Manganese Ore (India) Ltd. v. Regional Assistant Commissioner of Sales Tax [1976] 37 STC 489 (SC), Balabhagas Hulaschand v. State of Orissa [1976] 37 STC 207 (SC), Indian Oil Corporation Ltd. v. Union of India [1981] 47 STC 1 (SC), South India Viscose Ltd. v. State of Tamil Nadu [1981] 48 STC 232 (SC ). Shri Bapna drew my attention to annexures A to K in order to emphasise that prospective buyers used to submit their applications to the non-petitioner, which were registered by the non-petitioner. The applications were then processed and acceptance of the application was conveyed to the prospective buyers. Monthly requirement was indicated by the buyers and advance payment was made. All these actions were part of same transaction involving contract of sale. Goods could not have moved without the support of aforesaid contract and the purchaser was fully aware of the movement of goods in pursuance of the contract. Shri Bapna argued that when the Tribunal accepted the existence of contract, it was its duty to have examined the whole transaction. However, the Tribunal has ignored the salient fact, namely, as to why the requirement was taken on yearly/monthly basis, why price was paid in advance. Shri Bapna argued further that the very fact that goods were sent in bulk without specification and without indication about the requirement of individual buyer, are wholly irrelevant for determination of the issue as to movement of goods has taken place in pursuance of a contract of sale. Shri Bapna then argued that the Board of Revenue has committed a serious illegality in interpreting the notification dated December 31, 1975, issued under section 8 (5) of the Central Sales Tax Act. He argued that cathode and wire bars are separately identifiable commercial commodities and since they do not fall under section 8 (5), they were liable to be taxed at the normal rate. On the rate of interest, Shri Bapna argued that section 9 of the Central Sales Tax Act, which was added by notification dated September 7, 1976, ought to have been so interpreted as to advance the cause of revenue. Shri Bharat Khaitan, learned counsel appearing for the non-petitioner, on the other hand argued that the impugned order passed by the Board of Revenue does not suffer from any illegality much less an error of law warranting interference of the court. Shri Khaitan argued that in view of section 6-A of the Central Sales Tax Act which was introduced by the amending Act No. 61 of 1972 with effect from April 1, 1973, the burden of proof is ordinarily on the assessee to show that the movement of goods is not in pursuance of an agreement of sale. However, this burden stands discharged if the assessee produces form F. After making reference to provisions of rule 12 (5) of the Central Sales Tax (Registration and Turnover) Rules, 1957 and rule 16-B of the Central Sales Tax (Rajasthan) Rules, 1957 and form F, Shri Khaitan argued that for making a false declaration in form F a dealer is liable to be prosecuted and punished. Section 6-A (2) empowers the assessing authority to make an enquiry in respect of the particulars given in form F. It can then take action against the assessee if the particulars furnished by the assessee are found to be incorrect. This being the position and the assessee having produced form F, before the assessing authority, the same ought to have been treated as conclusive of the fact that the sale of the goods was no effected in pursuance of contract of sale. Shri Khaitan argued that for the purpose of enforcing Central Sales Tax Act, the sales tax authorities are duty-bound to discharge their duties under section 6-A and the only enquiry which could be made in such matters in one contemplated by section 6-A (2 ). Shri Khaitan argued that in para 63 (XXV), the Board of Revenue has made a specific reference to the fact that the assessee has produced form F and this finding of the Board has not been assailed by the department and, therefore, irrebuttable presumption has rightly been drawn by the Board of Revenue that the movement of goods has not taken place in pursuance of contract of sale. Shri Khaitan argued that bulk production of copper sheets and bars in being made by the non-petitioner. The production was of a general type without specification of goods for particular customer. The goods were sent to Delhi depot without reference to any particular buyer and they were disposed of generally. He drew the court's attention to the decision of the Supreme Court in Kelvinator of India Ltd. v. State of Haryana [1973] 32 STC 629. Shri Khaitan argued that the agreements arrived between the parties were nothing more than mere agreement for future sale and the same could not have been treated as concluded contract of sale. Shri Khaitan also pointed out that buyers have already been assessed by the sales tax authorities of the respective States and they have paid appropriate tax. In regard to rate of tax, Shri Khaitan submitted that the notification issued under section 8 (5) of the Act was meant only for the petitioner and, therefore, the Board of Revenue has rightly held that the said notification was attracted in the case of non-petitioner. On the question of interest, Shri Khaitan invited the court's attention to section 9 (2) of the Central Sales Tax Act and section 11-B of the Rajasthan Sales Tax Act and submitted that 3 per cent additional tax has already been paid by the non-petitioner. Section 6-A of the Central Sales Tax Act, 1956, rule 12 (5) of Central Sales Tax (Registration and Turnover) Rules, 1957 and rule 16-B of the Central Sales Tax (Rajasthan) Rules, 1957, read thus : " 6-A. Burden of proof, etc. , in case of transfer of goods claimed otherwise than by way of sale.- (1) Where any dealer claims that he is not liable to pay tax under this Act, in respect of any goods, on the ground that the movement of such goods from one State to another was occasioned by reason of transfer of such goods by him to any other place of his business or to his agent or principal, as the case may be, and not by reason of sale, the burden of proving that the movement of those goods was so occasioned shall be on that dealer and for this purpose he may furnish to the assessing authority, within the prescribed time or within such further time as that authority may, for sufficient cause, permit, a declaration, duly filled and signed by the principal officer of the other place of business, or his agent or principal, as the case may be, containing the prescribed particulars in the prescribed form obtained from obtained from the prescribed authority, along with the evidence of despatch of such goods. (2) If the assessing authority is satisfied after making such inquiry as he may deem necessary that the particulars contained in the declaration furnished by a dealer under sub-section (1) are true, he may, at the time of, or at any time before, the assessment of the tax payable by the dealer under this Act, make an order to that effect and thereupon the movement of goods to which the declaration relates shall be deemed for the purposes of this Act to have been occasioned otherwise than as a result of sale. Explanation.- In this section, "assessing authority", in relation to a dealer, means the authority for the time being competent to assessee the tax payable by the dealer under this Act. " " Determination of turnover. . . . . . . . . . . . . . . 12. . . . . . . . . . . . . (5) The declaration referred to in sub-section (1) of section 6-A shall be in form 'f' : Provided that a single declaration may cover transfer of goods, by a dealer, to any other place of his business or to his agent or principal, as the case may be, effected during a period of one calendar month : Provided further that if the space provided in form 'f' is not sufficient for making the entries, the particulars specified in form 'f' may be given in separate annexures attached to that form so long as it is indicated in the form that the annexures form part thereof and every such annexure is also signed by the person signing the declaration in form 'f' : Provided further that form 'f' in force before the commencement of the Central Sales Tax (Registration and Turnover) (Second Amendment) Rules, 1973, may continue to be used up to 31st day of December, 1980 with suitable modifications. " " 16b. Furnishing a copy of declaration under section 6a and of the statement in form C. S. T. 12.- Every dealer who claims that he is not liable to pay tax under the Central Act, in respect of any goods, on the ground that the movement of such goods from one State to another was occasioned by reason of transfer of such goods by him to any other place of his business or to his agent or principal, as the case may be, shall - (a) deliver portion marked 'original' of form 'f' prescribed under sub-rule (5) of rule 12 of the Central Sales Tax (Registration and Turnover) Rules, 1957, to the assessing authority within the time allowed by sub-rule (7) of rule 12 of the said Rules. The dealer shall retain the portion marked 'duplicate' of from 'f' which shall be produced for inspection when so required by the assessing authority; (b) furnish a statement in form C. S. T. 12 along with the return in form CST 1. "
(3.) SECTION 10 specifies the consequences of furnishing of a false certificate or declaration under section 6 (2) or section 6-A (1 ). Penalty which could be imposed as a result of furnishing of false declaration may extend to imprisonment of 6 months or fine or both and in case of continuing offence daily fine of Rs. 50 is required to be imposed. Therefore, if it is found that the non-petitioner had in fact furnished declaration in form "f" and the petitioner has not been able to establish that the declaration furnished by the non-petitioner was false, the burden of proof which rested on the non-petitioner to prove that the movement of goods from one State to another was not occasioned in pursuance of sale of goods, stood discharged and the non-petitioner cannot be called upon to make the payment of tax in regard to sale allegedly made in the course of inter-State trade. Perusal of the order of the Board of Revenue shows that the Board of Revenue has taken note of various circumstances. The Board concluded : " 63. Having considered the contents of the documents, lists and written arguments produced before the assessing authority and the learned Deputy Commissioner (Appeals) as well as 56 documents besides the copies of 'f' forms produced before us, we are convinced that they reflect the course of transaction as under : (i) The assessee-petitioner had established depots at mentioned places and was maintaining them at his own expense. (ii) Bulk quantity of copper, i. e. , cathodes, wire bars and chemical fertilizers (T. S. P. and S. S. P.) and other by-products were despatched by the factory at Khetri Nagar, Rajasthan, on requisition in the form of delivery orders issued by the depot offices without any reference to a particular contract of sale or a particular buyer. (iii) The goods were despatched by the factory from Khetri Nagar (Rajasthan) to various depots situated outside the State, and not to any particular person or buyer. (iv) The excise gate passes were prepared in the name of the depot agent concerned. (v) While sending the goods from the assessee-factory the delivery challan was prepared in name of the depot outside the State. (vi) Transport charges and octroi duty from the assessee-factory to the depots were paid by the assessee. (vii) Transit insurance of the goods from assessee-factory to the depot was paid by the assessee. (viii) Delivery of goods was taken by the staff of the depot or its clearing agent. (ix) Thereafter, the goods were taken in the godown of the depot and were stored in the godown. (x) The property in the goods remained with the Hindustan Copper Limited till they were sold by the depot to any particular buyer on appropriation at the discretion of the depot. (xi) Delivery of the goods were subsequently effected by the depot to various buyers by their own delivery orders or delivery challans. (xii) Delivery orders and challans were prepared by the depot after the receipt of the goods in their godown. (xiii) The goods were appropriated to a particular buyer in the depot outside. (xiv) The depots in various States are registered under the respective States for purposes of sales tax and have been assessed to sales tax in their respective States. (xv) The goods were neither manufactured according to the specification of a particular customer nor particular goods were meant for a particular customer so as to exclude the possibility of any diversion. (xvi) The goods were cleared by the officers of the assessee-company at various depots and expenses on account of freight, loading and unloading and insurance charges from factory to depots were borne by Hindustan Copper Limited and the goods are stored in their godown and the delivery is made to the customers from the godown by preparing weight list, delivery challans and sale invoices from depots. (xvii) The depot managers have the discretion to deliver the goods in any quantity or to any customer of their choice. (xviii) As regards the disputed sale amounting to Rs. 4,85,65,844. 80 the depots have not acted as a conduit pipe as there was neither any agreement or correspondence with the factory was aware as to whom the goods were likely to be supplied from Khetri under the various bulk delivery orders sent by various depots from time to time. (xix) The depot managers have absolute discretion to supply goods of any origin from the huge stock lying at various godowns of the sales offices situated outside the State of Rajasthan. There is every possibility that one customer can be supplied goods of both the origin. (xx) In case of scrap all the activities were performed at Delhi and even the customers were not aware of its movement nor the same was contemplated. No registration was done or offer notes issued for these goods. (xxi) There was all possibility of diversion of goods after despatch from Khetri as the goods were not manufactured of a particular specification for a particular customer. (xxii) Delivery of wire bars was given against the offer notes of cathodes and vice versa. (xxiii) In case of fertilizers, the distributorship agreement cannot be equated with firm orders and on being convinced with the true legal position the transactions were rightly considered as sales made outside the State of Rajasthan by the assessing authority while framing final assessment for the assessment years 1977-78 and 1978-79 which was not challenged in any proceeding. (xxiv) The procedure of sales effected by the sales office situated in Delhi as indicated by the Commercial Taxes Officer, Special Circle, Bikaner, in his survey report available on record also supports the contentions of the petitioner-assessee. However, the inference drawn by the said officer is not correct. (xxv) None of the contents of 'f' form produced was found incorrect. " Learned counsel for the petitioner has not been able to show and in fact it has not even been asserted by the petitioner in the revision petitions that the facts mentioned in paragraph 63 of the order of Board of Revenue are factually incorrect. It has also to be noted that no review was filed before the Board of Revenue by the petitioner nor any application was moved by the petitioner for correction of so-called factual error in the order. Thus, in my opinion the conclusion recorded by the Board of Revenue that the disputed sales of copper, chemical fertilisers, T. S. P. and S. S. P. and other by-products effected by the assessee-company from various depots situated outside the State of Rajasthan, could not have been deemed to have taken place in the course of inter-State trade and commerce, does not call for any interference by this Court. The Board of Revenue has made detailed reference to various decisions on which reliance has been placed by learned counsel for the petitioners as well by learned counsel for the non-petitioner and had dealt with each judgment in detail in paragraphs 42 to 61. In my opinion it is not necessary to make detailed reference to all its decisions. In view of my conclusion that on the face of furnishing of form "f", the burden of proof was satisfactorily discharged by the non-petitioner. ;