ASSAM COMPANY INDIA LTD Vs. COMMISSIONER OF TAXES ASSAM GUWAHATI

JUDGEMENT

(1.) This writ appeal arises out of a judgment and order dated August 12,1994. The brief facts are as follows : The petitioner-appellant is a private limited company and carries on the business of cultivation, manufacture and sale of tea. The petitioner-appellant is registered as dealer under Section 7 of the Central Sales Tax Act, 1956 (hereinafter referred to as "the Central Act"), in respect of all the tea estates owned by it. The petitioner-appellant is also registered as a dealer under the Assam Sales Tax Act, 1947 (hereinafter referred to as "the Assam Act"). That the petitioner-appellant in course of carrying business depatched tea from its different tea estates in Assam to Calcutta and Guwahati for sale. Tea was also despatched from the tea estates of the petitioner-appellant to other States for selling the same through different consignment agents appointed for the purpose. The petitioner-appellant has been regularly submitting its return of turnover showing therein the particulars of sale in the prescribed form as required under the Central Act and the Assam Act and the taxes were also paid from time to time as required by law. Assessments were also made from time to time by the Superintendent of Taxes, Tinsukia. That for the period ending March 31, 1980 the petitioner-appellant submitted its return of turnover with the Superintendent of Taxes, Tinsukia, respondent No. 3 (i.e. Civil Rule No. 65 of 1989). The petitioner-appellant appeared before the Superintendent of Taxes, Tinsukia in compliance with the notice issued under Section 17(2) of the Assam Act read with Section 9(2) of the Central Act and produced the books of account and documents in support of the return. The petitioner-appellant also filed all relevant "F" forms in support of the transfer of tea to the various agents of the petitioner-appellant in the State of Maharashtra and Gujarat for sale on consignment basis. It was contended that these transfers were by way of stock-transfer otherwise than by way of sale and as such, the petitioner-appellant was not liable to pay tax under the Central Act and as such no tax was paid by the petitioner-appellant. These facts were accepted by the Superintendent of Taxes and assessment was completed vide order dated January 23,1981 under Section 17(3) of the Assam Act read with Section 9(2) of the Central Act. A copy of this order is at annexure I to the writ application. That on April 15, 1981 the Inspector of Taxes, seized some books of account and documents of the petitioner-appellant-company in the purported exercise of power under Section 44(3) of the Assam Act. The petitioner-appellant-company was thereafter served with notice dated May 20,1981 purported to be a notice under Section 19A of the Assam Act read with Section 9(2) of the Central Act. By the aforesaid notice the manager of the tea estate was informed that the turnover for the period ending September 30, 1978, March 31, 1979 and March 31, 1980 had escaped assessment. A copy of the aforesaid notice is dated May 20, 1981 at annexure II to the writ application. That the Superintendent of Taxes, Tinsukia, vide order dated July 22, 1981 reassessed the turnover of the petitioner-appellant treating the despatches made by the petitioner-appellant outside the State of Assam to the agents by way of sale as inter-State sales and they demanded a sum of Rs. 20,282 on account of tax and Rs. 13,080 on account of interest was raised on the petitioner-appellant for the period being September 30,1978. The petitioner-appellant preferred appeal before the Assistant Commissioner of Taxes (Appeals) Jorhat. The Assistant Commissioner of Taxes (Appeals), vide his order dated April 5, 1983 on consideration of the application to pay 25 percent of the disputed demands for each of the period, ultimately these appeals were transferred to the Assistant Commissioner of Taxes (Appelas), Tinsukia. The Assistant Commissioner of Taxes (Appeals) Tinsukia heard the appeals and the main contention was that the burden on the assessee is discharged on the filing of the "F" forms as prescribed by rule 12(5) of the Central Sales Tax (Registration and Turnover) Rules, 1957 and that the conditions precedent for exercise of powers under Section 19A was wholly non-existent. A written argument was also filed before the appellate authority and that is annexure VI to the writ application. A review application was filed before the Commissioner of Taxes, Assam, Guwahati. The Commissioner of Taxes rejected the review application by a common order dated June 24,1988 holding that the Superintendent of Taxes has rightly assessed the turnover, i.e., annexure IX to the writ application. Thereafter the demand notice was served on the petitioner-appellant to pay the impugned demand within November 11, 1988.

(2.) That the writ petitioner (appellant) moved an application under Article 226 of the Constitution of India which was numbered as Civil Rule No. 65 of 1989 for the following prayer :

(3.) No affidavit-in-opposition was filed in the writ application by the respondents. However, the respondents produced photo copies of the records. The learned Judge on consideration of the submissions made by the petitioner-appellant at the time of hearing of the application as well as the counsel for the respondents and on the basis of the documents filed along with the writ petition and the documents produced by the respondents authorities at the time of hearing of the application considered the matter at length and was pleased to hold that the transfer of the goods from the State of Assam to the States of Maharashtra or Gujarat was inter-State sale and not a stock transfer as claimed by the writ petitioner (appellant) and upheld the orders passed by the tax authorities. As against the said judgment the counsel for the appellant had urged two points, firstly, the use of the expression buyer or seller is not conclusive if the transaction was in the nature of stock transfer, the use of the word buyer would not make the said transaction a sale. For this purpose the counsel relies on the decision of the Supreme Court as reported in [1981] 70 STC 107 (Alwaye Agencies Vs. Deputy Commissioner of Agricultural Income-tax and Sales Tax, Ernakulam). The second point urged was that the assessee submits "F" form relating to the movement from one State to another with full particulars provided therein. The tax authority has to accept the same and cannot ask for any further or other evidence and should treat the movement of the goods as stock transfer from one State to another. The authorities cannot thereafter go behind the said "F" form and make a finding contrary to the particulars contained in the declaration furnished by the dealer under sub-section (1) of Section 6A. We have carefully considered the submissions made by Dr. A. K. Saraf on behalf of the writ petitioner (appellant) and do not find any substance in the same. The single Judge has carefully gone into the factual position of the transaction including the agreement between the parties and the various other documents furnished to the court at the time of hearing of this writ application whereby the movement of goods from one State to another has taken place. The learned Judge has also noticed that in the writ application it is nowhere alleged that the firm issuing "F" form were agents of the petitioner (appellant). Under Section 6A(1) of the Central Sales Tax Act, 1956 the burden is on the dealer to prove that the movement of goods was occasioned not by reason of sale, but was occasioned by reason of transfer of such goods by him to any other place of his business or his agent or principal outside the State. The burden so cast on the dealer cannot be discharged by merely furnishing the declaration as prescribed (F forms) along with the evidence of despatch of such goods. Furnishing of the declaration (F forms) is not conclusive or mandatory. In cases where the dealer exercises the option of furnishing the declaration (F forms), further requirement is that the assessing authority should be satisfied, after making such enquiry, as he may deem necessary, that the particulars contained in the declaration furnished by the dealer are "true". It is not possible or practicable to lay down the exact documents or materials that may be required in all the cases, by the assessing authority, to come to a proper and just finding as required by Section 6A (2) of the Act.