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The Commissioner Trade Tax U.P. Lko. v. Shiva Paper Mills Ltd. Rampur - SALES/TRADE TAX REVISION No. 702 of 1996 [2005] RD-AH 4228 (7 October 2005)


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Court no.55


The Commissioner, Trade Tax, U.P., Lucknow.           Applicant


S/S Shiva Paper Mills, Limited, Rampur.  Opp.Party.

Hon'ble Rajes Kumar, J.

Present revision under Section 11 of U.P. Trade Tax Act (hereinafter referred to as "Act") is directed against the order of Tribunal dated 27th February, 1996 relating to the assessment year 1991-92 by which the Tribunal has accepted the claim of the dealer for stock transfer to its depot situated at Delhi.

Dealer/opposite party (hereinafter referred to as "dealer") was engaged in the manufacture and sale of writing and printing paper. The dealer had its factory at Rampur and head office and sale depot at Delhi. During the year under consideration, the dealer had transferred goods worth Rs.14,30,27,250.89 paise from its factory at Rampur to the head office at Delhi. The assessing authority had rejected the stock transfer amounting to Rs.25,65,720/- and treated the same to be the inter-State sales. First appeal filed by the dealer was rejected. Tribunal, by the impugned order, allowed the appeal and accepted the stock transfer.

Heard learned Standing Counsel and Sri Piyush Agrawal, learned counsel for the dealer/opposite party.

On 06.12.2004, learned Standing Counsel was directed to produce the assessment record containing various parchas on which the assessing authority relied for treating the transactions as inter-State sales. Learned Standing Counsel submitted that the assessing authority had rejected the stock transfer to Delhi depot mainly on the ground that the goods which have sold on the same day when they were reached at Delhi office and the documents which have been relied upon were inter office memo which were seized at the time of survey dated 20.11.1992 relates to the assessment year 1992-93 which have also been referred and considered by the Tribunal. He submitted that apart from the aforesaid documents, there was no other document relating to the year under consideration. He submitted that the goods have been sold by the depot on the same day which were received at the Delhi office shows that the movement of goods was in pursuance of prior contract of sale. He further submitted that the inter office memo which has been referred in the order of the Tribunal also shows that the goods have been despatched from the factory in pursuance of the requisition made by the Delhi office.

I have perused the order of the Tribunal and the authorities below.

For a transaction being inter-State sale under section 3 of the Central Sales Tax Act, it is necessary that there should be movement of goods in pursuance of the prior contract of sale. Merely because the goods have been sold by the depot on the same day when they reached, is not sufficient to conclude that the goods moved from the factory in pursuance of the prior contract of sale. Perusal of the inter office memo which has been referred in the order of the Tribunal also shows that the goods have been despatched as per the requisition of the Delhi office and not in pursuance of any order of the buyer. Tribunal has considered the entire facts and circumstances of the case and arrived to a conclusion that there was nothing on record to prove the link between the stock transfer and sales made from the depot and the movement of goods from factory to Delhi depot was in pursuance of any prior specific order. It has also been held that there was nothing to show that goods were manufactured as per specification of customer. The goods have been transferred from Rampur factory to Delhi depot in lump sum as per inter office memo received from the Delhi office. Finding of the Tribunal is finding of fact based on the material on record. Learned Standing Counsel is not able to assail the finding recorded by the Tribunal. In the circumstances, I do not find any error in the order of the Tribunal.

In the result, revision fails and is accordingly, dismissed.




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