By C. B. Thakar Advocate G. G. Goyal
Janak Vaghani Chartered Accountants
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Central Sales Tax – Inter-State Stock Transfer to Agent – Agent Supplying Goods Directly to His Customer for Sale in Other State – After Making Payment for Lorry Freight, Octroi, etc.- Is Consignment Sale and Not Inter-State Sale, section 3(a) of The Central Sales Tax Act, 1956.
FACTS
Respondent a dealer in Timber had supplied goods to his agent outside the State and claimed inter-state stock transfer against form F and was assessed accordingly under the CST Act. Thereafter, the Deputy Commissioner of sales tax, based on verification report received from the enforcement department, revised the assessment order under the CST Act and disallowed the claim of consignment sales on the ground that the goods were supplied directly to the buyer and goods were never reached to the agent. Therefore, the revising authority treated it as inter-state sales and levied tax under the CST Act. The Tribunal allowed the appeal filed by the respondent dealer against which State filed writ petition before the Madras High Court.
Held
It is very clear that the delivery note itself contains the name of the agent and it is also very clear that the payment made to the respondent by the agent was only a net amount after deducting commission amount from total sales. If it was not consignment where was the question of payment of commission? Further, the agent had paid lorry freight, octroi, unloading charges and measurement charges for the goods transported to another buyer. This fact was verified by the assessing authority while allowing exemption which was not considered by the first appellate authority. Hence, the Tribunal had rightly considered this matter and categorically came to the conclusion that it was a clear cut sale outside the State and rightly the exemption was granted. Accordingly, the High Court dismissed the writ petition filed by the Sate and confirmed the order of Tribunal allowing the appeal of the respondent dealer.
