Allahabad High Court

Glaxo Smith Kline ... vs The Commissioner Trade Tax ... on 2 August, 2018

Bench: Rajan Roy




HIGH COURT OF JUDICATURE AT ALLAHABAD, LUCKNOW BENCH
 
 

							AFR										          Reserved on: 03.05.2018
 
Delivered on: 02.08.2018.
 

 

 
Court No. - 22
 

 
Case :- TRADE TAX REVISION No. - 12 of 2009
 

 
Applicant :- Glaxo Smith Kline Pharmaceuticals Ltd. Through Its Authorise
 
Opposite Party :- The Commissioner Trade Tax Lucknow
 
Counsel for Applicant :- Nandit Srivastava,Alok Kumar Singh,Gantavya Chandra,Kumar Abhishek,Meha Rashmi,Ritwick Rai,Tapeshwar Kumar
 
Counsel for Opposite Party :- C.S.C.
 

 
Hon'ble Rajan Roy,J.

This is a Revision which was admitted by this Court on 06.02.2009 on the following questions framed in paragraph 2 of the Revision:-

"i. Whether, on the facts and in the circumstances of the case, Stock Transfer of Goods and submission of statutory Form ''F' attracts Trade-tax ?

ii. Whether, on the facts and in the circumstances of the case, the Form ''F' would be considered conclusive proof of Stock Transfer ?

iii. Whether, on the facts and in the circumstances of the case, Stock Transfer can be considered Inter-State Sale, without any cogent reason ?

iv. Whether, on the facts and in the circumstances of the case, the Animal Health Products/Cattle Feed are covered by Notification No.ST-2-7036/10-7( ) 23-83 dated 31.-1.1985 ?"

The Revisionist is a manufacturer of ''Ghee' which had its factory at Aligarh and according to it, it transferred a Stock of Ghee to the tune of Rs.1,48,71,415.86 from Aligarh to its ''Clearing and Forwarding Agents' at Jaipur in Rajasthan involving various transactions which is in dispute and has been treated as Inter-State sale. Form-F referred in Section 6-A(2) of the Central Sales Tax Act, 1956 (hereinafter referred to as ''the Act, 1956') read with Rule 12(4) of the Central Sales-tax (Registration and Turnover) Rules, 1957 (hereinafter referred to as ''the Rules, 1957'), as issued by the Principal Officer at Jaipur, was submitted before the Assessing Authority in the State of U.P. allegedly in term of Section 6-A of the Act, 1956 read with the corresponding Rules, 1957. However, the Assessing Authority did not accept the particulars mentioned in Form-F, and treated the transaction referred hereinabove as Inter-State Sale liable to tax under Section 6 of the Act, 1956 and imposed a tax liability of Rs.18,20,713.77. The First Appellate Authority affirmed the order dated 30.03.1995 vide his order dated 28.08.1995. The Tribunal set aside the order and remanded the matter back to the Appellate Authority for reconsideration as to whether the transactions were similar to other transactions, vide its judgment dated 26.09.2005. Consequent to it i.e. after remand, the Assessing Authority reconsidered the matter vide his judgment dated 06.10.2006 and again took the same view rejecting Form -F submitted by the Revisionist on the ground that in order to examine the matter in the light of the order of the Tribunal dated 26.09.2005 it was necessary to look into the account books and other original records relating to the transactions but none of these were produced before him inspite of show cause notice having been issued in this regard. It observed that particulars mentioned in Form-F were not got verified from original documents and the account books nor from the account books of Jaipur depot of the Clearing and Forwarding Agents. In view of this he reiterated the earlier view that the transaction was Inter State Sale as Clearing and Forwarding Agents was not free to sell off the Stock independently and that as per the agreement delivery of stock to the purchaser was to be made on the directions of the Revisionist and at the rate which was to be determined by the Revisionist Company. The said assessment order was affirmed by the First Appellate Authority vide its order dated 19.07.2007 with the observation that the appellant (revisionist herein) did not produce the relevant documents relating to stock transfer nor the account of the Jaipur depot before the Assessing Authority nor before him i.e. the Appellate Authority, as such, in the absence of these records which were necessary for verification of each of the transaction the Assessing Authority had rightly rejected Form-F submitted by the Appellant (revisionist herein) which did not require any interference. The contention of the revisionist-appellant that Form-F was conclusive proof of the Stock Transfer was repelled by the said authority albeit relying upon the judgment of the Supreme Court in the case of Ashok Leyland vs. Union of India and others reported in (1997) UPTC 1187 SC. It is not out of place to mention that this decision has been over ruled by the Supreme Court in the subsequent decision of Ashok Leyland vs. State of Tamil Nadu reported in (2004) 3 SCC 1(hereinafter referred to IInd Ashol Leyland case), wherein it has been held that an order accepting Form-F under Section 6-A of the Act, 1956, raises an irrebuttable and conclusive presumption as to the transaction being a stock transfer and not a sale but more of it later.

Be that as it may, against the said order a second appeal was filed by the Revisionist before the Tribunal which was rejected on 27.09.2005. The Tribunal's order states that notices were issued to the appellant (revisionist herein) to appear along with account books and complete details regarding the Stock Transfer to Jaipur and to get the said transactions verified from the account books. In response to it the appellant (revisionist) herein submitted that Clearing and Forwarding

Agents had sent a copy of the statement of Accounts of the said transactions, the Stock Transferred to Clearing and Forwarding Agent was not meant for any specific customer. The Tribunal inter-alia observed that verification of particulars of Form-F and as to when the transactions as mentioned therein had taken place could be verified only from the account books but the same had not been produced. The contention that submission of Form-F was conclusive proof of Stock Transfer was rejected with the observation that the burden is on the dealer to prove that the transaction was Stock Transfer and it was not Inter State Sale but it had not done so by producing the relevant evidence to support Form-F inspite of notice.

The contention of Sri Karan Sachdeva along with Sri Ritwick Rai, who appeared on behalf of the Revisionist, was that filing of Form-F in terms of Section 6-A of the Act, 1956 read with Rule 12(4) of the Rules 1957 was conclusive proof that the transactions were by way of Stock Transfer and not Inter State Sale. In this regard he relied upon a decision of the Supreme Court in IInd Ashok Leyland case(supra). He contended that the earlier view of the Supreme Court as expressed in its earlier decision i.e. Ist Ashok Leyland case(supra) had been over-ruled by the subsequent decision. He invited the attention of the Court to paragraphs 51, 52, 54, 56 and 101, 102, 103, 104 of the said judgment in support of his contention. It was also his contention that none of the ingredients of Sale, much less inter-State Sale, had been established and that the Tribunal had proceeded on a wrong premise thereby travelling beyond Section 6-A of the Act, 1956 . The judgment referred by it was not at all applicable. He also laid great emphasis upon the fact that the provision of Section 6-A had been amended in the year 2010 enlarging the scope of inquiry under sub section 2 thereof, but prior to the said amendment the scope of inquiry was limited as had been held by the Supreme Court in paragraph 102 of the judgment in IInd Ashok Leyland case (supra). According to him the Tribunal and other authorities had failed to appreciate this aspect of the matter and had passed the order without there being any proof of Inter-State Sale or any cogent reason to establish that it was not a Stock Transfer. He also relied upon the decisions rendered in the case of Tata Engineering & Locomotive Co. Ltd. Vs Assistant Commissioner of Commercial Taxes reported in (1970) 1 SCC 622, Seagram Manufacturing Pvt. Ltd. Vs. Commissioner of Commercial Taxes, U.P. Lucknow reported in (2011) 37 VST 530 (Alld.), State of Andhra Pradesh vs. Shree Akkamamba Textiles Ltd. reported in (2014) 43 GST 627 (A.P), State of Tamil Nadu vs. Parry Agro Industries Ltd. & anr. reported in (2011) 42 VST 362 (Mad.) and Eternit Everest Ltd. Vs. State of Tamil Nadu reported in Manu/TN/3431/2017 (Mad.), North Star India Pvt. Ltd. Vs. Commissioner Trade Tax reported in (2009) 25 VST 378 (Alld) in support of his contentions. It was also his contention that the goods had not been sent to any specific third party but had been sent to the Clearing and Forwarding Agent and there was no proof of it being a sale. Sri Karan Sachdeva did not advance any other argument.

Sri Rohit Nandan Shukla, learned Additional Chief Standing Counsel relied upon the decision of the Division Bench of Karnataka High Court rendered in the case of Harison and Company vs. The Additional Commissioner reported in 2006 146 STC 609 Kar and a judgment of Division Bench of Kerla High Court in the case of CPK Trading Company vs. Additional Sales Tax Officer and another Writ Appeal No. 498 of 1983 decided on 07.06.1989 to contend that the Assessing Authority was well within his jurisdiction to have requisitioned the account books and other records for satisfying himself as to the particulars mentioned in Form-F regarding the transactions which were being claimed as a Stock Transfer as individual transactions were required to be verified which could only be done on the basis of account books. According to him the account books were relevant as they would reveal whether the alleged stock had been sold off with the prior agreement of sale or it was a transfer to an Agent. The filing of Form-F was not conclusive proof of the transactions and no such proposition of law had been laid down by the Supreme Court in the case of IInd Ashok Leyland (supra); the authorities had rightly rejected the Form-F submitted by the Revisionist and the First Appellate Authority and the Tribunal had rightly affirmed the order of the said authority. He relied upon the cases of Kanha Vanaspati Udyog Limited Vs. CCT reported in 2002 UPTC 50 Alld, Bandamidi Rajaiah & sons vs. Board of Revenue reported in (1978) STC 146 Alld, CST vs. Agra Food Products Ltd. reported in (1987) 67 STC 266 Alld., Modi Spinning and Weaving Mills, Gaziabad vs. CST reported in 2005 UPTC 342 Alld. and Renu Chemicals Ltd. Renukot Vs. CTT 2004 UPTC 160 Alld., in support of his contentions.

Section 6-A as it was applicable to assessment year 1990-91 is quoted below:-

"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 the prescribed authority, along with the evidence of dispatch 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 the 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 assess the tax payable by the dealer under this Act."

Under Section 6 of the Act, 1956 an Inter-State sale is exigible to tax. Whether or not a transaction is a Sale is normally to be proved by the Assessing/Revenue Authority, however, by insertion of Section 6-A in the Act, 1956 this legal position was changed and the burden of proof in this regard was saddled on the dealer. The said provision as it existed prior to its amendment by the Act No.20 of 2002 gave an option to the dealer to furnish Form-F declaring the transaction to be Stock transfer and if the Assessing Authority, after making such inquiry as he deemed necessary, was satisfied that the particulars contained in the declaration furnished by the dealer under sub Section (1) were true he could, at the time of, or at any time before, the assessment of tax payable by the dealer under the said Act, make an order to that effect and thereupon the movement of goods to which the declaration related would be deemed for the purpose of the said Act to have been occasioned otherwise than as a result of Sale. The dealer could also lead other evidence to prove that the transaction (s) was a stock transfer and not a sale, as filing of Form-F was merely an option available and not mandatory. This provision underwent a change by the Act No. 20 of 2002 whereby the words - "and if the dealer fails to furnish such declaration, then the movement of such goods shall be deemed for all purposes of this Act to have been occasioned as a result of Sale", meaning thereby prior to this amendment an option was available to the dealer to furnish form-F but even if he did not do so it was open to him to prove otherwise that the transaction was a Stock Transfer and not an Inter-State Sale but after the amendment in the year 2002 in the event of non submission of Form-F the movement of such goods was to be deemed to have been occasioned as a result of sale for the purposes of the said Act and liable to tax accordingly. In the case at hand it is the unamended provision existing prior to the year 2002 which is applicable as the dispute is with regard to Assessment year 1991-92.

There is no dispute about the movement of the goods in question from the Revisionist's Factory at Aligarh, U.P. to State of Rajasthan (Jaipur). The only question is, was it a Stock Transfer or an Inter State Sale ? As already stated hereinabove, the Revisionist exercised its option of submitting Form-F issued by the Principal Officer of the other place of business i.e. Jaipur, before the Assessing Authority in the State of U.P. Based on it, it was contended that this was conclusive proof that the transactions were Stock Transfer and unless the particulars mentioned in Form-F were belied or proved to be wrong, incorrect, fraudulent, the Assessing Authority was bound to have treated the transaction as having been occasioned otherwise than as a result of Sale i.e. as Stock Transfer which was not liable to be taxed.

Contention of Sri Karan Sachdeva in this regard cannot be accepted in the facts of the present case, firstly; for the reason, the submission of Form-F by itself does not raise any un-rebutable or conclusive presumption regarding the transaction(s) being Stock Transfers. The judgment of the Supreme Court in the case of IInd Ashok Leyland case does not lay down any such proposition. What it says is that once an order accepting Form-F has been passed under Section 6-A(2) then the veracity of the transaction and validity of the said order cannot be questioned subsequently by reopening the case on this ground. Thus, the ratio of the judgment is that the order accepting Form-F is final and binding and not that mere submission of Form-F is conclusive proof of Stock Transfer or that the transaction was not a sale. In the present case Form-F was not accepted by the Assessing Authority while exercising his power under Section 6-A(2), albeit at the time of assessment, therefore, the principle of law laid down in IInd Ashok Leyland case (supra) as referred hereinabove does not apply. Now so far as reliance placed by Sri Sachdeva upon paragraphs 51 to 55 and 101 to 104 of the said judgment is concerned, in the first Ashok Leyland case the opinion expressed was that Section 6-A does not create a conclusive presumption and an order accepting form-F is part and parcel of the order of assessment and its amenability to the power of reopening and revision depended upon the provisions of the State Sales Tax enactment concerned by virtue of Section 9(2). It is this observation made in paragraph 20 of the said judgment which was held to be incorrect by the Supreme Court in the IInd Ashok Leyland case (supra) in paragraph 55. Thus as already stated hereinabove, the IInd Ashok Leyland case (supra) case held that an order passed under Section 6-A accepting Form-F was final and conclusive. This does not help the Revisionist before this Court as no such order has been passed in its case, therefore, reliance upon paragraph 51 to 55 does not help the case of the Revisionist.

Now as far as the observation contained in paragraphs 101 to 104 is concerned much emphasis was laid on paragraph 102 which reads as under:-

"The particulars required to be furnished in Form

F clearly manifest that the poof required is as to whether the goods were factually transferred to the assessee himself or his branch office or his agent and not to any third party. Any other enquiry is beyond the realm of the assessing authority."

Even from the said observations of the Supreme Court it is evident that the proof required to be given by the dealer in respect of the particulars mentioned in Form-F is as to whether the goods were factually transferred to the Assessee himself or its branch office or agent and not to a third party and that an inquiry into this aspect was well within the realm of the Assessing Authority. In the case at hand after the matter was remanded back by the order of the Tribunal dated 26.09.2005, a show cause notice was sent to the Revisionist asking it to appear along with the original records, account books, the details of Stock Transfer to Jaipur and to get the same verified from the said account books but inspite of this notice the Revisionist did not produce the said records. All that was produced was a copy of the statement of accounts sent by the Clearing and Forwarding Agent from Jaipur. Each individual transaction of Stock Transfer was required to be verified as has been held by the Kerla High Court in the case of Renu Chemicals vs. CIT 2004 UPTC 160 Alld and this could be done only from the relevant record requisitioned by the Assessing Authority and not otherwise. In this context we must keep in mind that the case at hand pertains to the year 1991-92 i.e. prior to the coming into force of the amendment in the year 2002, therefore, during the said period the dealer had an option to establish that the transaction was Stock Transfer either by submitting form-F subject to its scrutiny by the Assessing Authority or by other means such as furnishing of documents of Account. The Assessing Authority as is evident from the provision contained in sub section 2 of Section 6-A of the Act, 1956 as existing at that time, was required to satisfy himself as to whether the particulars contained in the declaration furnished by a dealer under sub section (1) are true. This satisfaction was to be arrived at after making such inquiry as he may deem necessary. Now the inquiry obviously was with regard to the particulars contained in Form-F and the particulars would be regarding the transaction of Stock/goods claimed otherwise than by way of sale. In this context of verification of the particulars for the purposes of arriving at a satisfaction in terms of sub section 2 of Section 6-A, the Assessing Authority was well within his jurisdiction to requisition the relevant account books and other documents relating to the transaction as as they would reveal whether there was a prior agreement to sale etc. but the Revisionist did not produce the account books and other records relevant to the matter. On account of non production of such records it was not possible for the Assessing Authority to satisfy himself as to the genuine-ness of the particulars mentioned in Form-F. Not only the said records were not produced before the Assessing Authority they were not produced even before the First Appellate Authority and before the Tribunal which is the last fact finding authority. No reason cogent reason was put-forth by Sri Sachdeva for the non-production of records except to say that it was not required as Form-F was condusive proof of the transactions being a Stock transfer not an Inter-State sale, which, for the reasons already discussed, is untenable in law.In these circumstances if the Assessing Authority rejected the declaration submitted by the Revisionist in form-F and treated the transaction as Inter-State Sale liable to tax, he cannot be faulted nor can the First Appellate Authority and the Tribunal be faulted on this account. Even though the first appellate authority should not have relied upon the Ist Ashok Leyland case as it was over ruled, it has no adverse bearing on this aspect of the matter i.e. so far as the nature of inquiry by the Assessing Authority and the satisfaction to be arrived at by the authority is concerned as even the IInd Ashok Leyland case does not hold that filing of Form-F itself is conclusive proof of transaction being a stock transfer. Reference may be made in this regard to the Division Bench judgment in the case of CPK Trading Company (supra) wherein it has been held as under:-

"In the instant case, it is common ground that the appellant/ dealer produced the sale pattials (?) and the declarations (F forms). As stated by us, in Vijayamohini Mills' case [1989] 75 STC 63 (Ker) ; (1989) 1 KLT 515, even after the production of F forms, it is open to the assessing authority to make further enquiry to satisfy himself that the particulars contained in the declaration (F forms) are "true". It is only then, the assessing authority is enjoined to pass an order in the matter. A plain reading of Section 6A(2) of the Central Sales Tax Act points out that in cases where the dealer exercises the option of furnishing the declaration (F forms), the only 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". The scope or frontiers of enquiry, by the assessing authority under Section 6A(2) of the central Sales Tax Act is limited to this extent, namely, to verify whether the particulars contained in the declaration (F forms) furnished by the dealer are "true". It means, the assessing authority can conduct an enquiry to find out whether the particulars in the declaration furnished are correct, or dependable, or in accord with facts or accurate or genuine. That alone is the scope of the enquiry contemplated by Section 6A(2) of the Act. On the conclusion of such an enquiry, he should record a definite finding, one way or the other. As to what should be the nature of the enquiry, that can be conducted by the assessing authority under Section 6A(2) of the Act, is certainly for him to decide. It is his duty to verify and satisfy himself that the particulars contained in the declaration furnished by the dealer are "true". As a quasi-judicial authority, the assessing authority should act fairly, and reasonably in the matter. During the course of the enquiry, under Section 6A(2) of the Act, it is open to him to require the dealer to produce relevant documents or other papers or materials which are germane or relevant, to find whether the particulars contained in the declaration (F forms) are "true". It is not possible to specify the documents or other materials or papers that may be required, to be furnished in all situations and in all cases. It depends upon the facts and circumstances of each case. The power vested in the officer is a wide discretionary power, to find, whether the particulars contained in the declaration (F forms) 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."

This judgment had been referred in paragraph 63 of the IInd Ashok Leyland case and when the above quoted portion is read conjointly with paragraph 102 of the IInd Ashok Leyland case the scope of inquiry by the Assessing Authority would be clear. The observations in CPK Trading Co. have not been disapproved. On the issue as to what should be the nature of inquiry under Section 6-A, the law has been elaborately dealt with in CPK Trading Co. case (supra) wherein it has been held that it is for the Assessing Authority to decide. As a quasi judicial authority it is open for the Assessing Authority to require the dealer to produce the relevant documents and other papers or material which are germane or relevant to find out as to whether the particulars contained in declaration (Form-F) are ''true'. The Division Bench of Kerla High Court went on to observe that "it is not possible to specify the documents and other materials or papers that may be required, to be furnished in all situation and in all cases". It depends upon the facts and circumstances of each case. The power vested with the Officer is a wide discretionary power, to find, whether the particulars contained in the declaration Form-F are ''true'.

The necessity of summoning of the account books has already been dealt with earlier. In the present case no plausible reason has been given by the Revisionist for non-production of the account books and other records as requisitioned by the Assessing Authority. Though, the scope of inquiry under Section 6-A(2) is limited to the veracity of the particulars mentioned in Form-F, the nature of the inquiry could encompass the requisitioning of relevant records and the IInd Ashok Leyland case does not lay down any proposition of law to the contrary.

It has to be kept in mind that under Section 6-A the burden is upon the dealer to prove that it is a Stock Transfer and if he submits Form-F the burden is upon him to prove the particulars mentioned therein and satisfy the Assessing Authority as to their truthfulness and in this process if the Assessing Authority demands certain records the dealer is bound to produce it to facilitate the inquiry referred in sub section (2) and a satisfaction being arrived at by the assessing authority as envisaged in the said provision. If it does not, then the Assessing Authority is within his jurisdiction to reject form-F. Similar view has also been expressed by a Division Bench of Karnataka High court in the case of Harison and Co. (supra) wherein the IInd Ashok Leyland case has been considered and it has been held as under:-

" 14. Section 6-A of the CST Act provides for burden of proof in case of transfer of goods claimed otherwise than by way of sale.

Section 6-A(1) of the CST Act is clearly in two parts. The first part throws the burden of proof on the dealer to prove that a particular movement of goods has been occasioned otherwise than as a result of sale. In order to prove this fact, the second part of the Section throws the burden on the dealer. The dispatching dealer should obtain 'F' form declaration from the consignee and furnish the same to the assessing authority along with the evidence of dispatch of the goods and satisfy the authority about the correctness of the particulars contained in the declarations. Failure to produce this declaration or otherwise to satisfy the assessing authority about the nature of the transaction or about the correctness of the particulars given in the form, the assessing authority will be well within his jurisdiction to treat the transaction as interstate sales under the CST Act. The burden of proof that movement of goods is only by way of branch transfer and not by way of interstate sales is always upon the assesses/dealer and never shifts on the revenue. Failure by the dealer to discharge this burden would lead to the irresistible inference that there have been sales under the CST Act.

15. In Government Of Andhra Pradesh v. Guntur Tobaccos (1965) 16 STC 240, the Supreme Court has observed that normally under the Sales Tax Laws, the onus of proving that a transaction is a sale, is on the taxing authorities and it is not incumbent on the assessee to prove to the contrary. This view is reiterated by the Apex Court in the case of COMMISSIONER OF SALES TAX v. SURESH CHAND JAIN, , wherein the Supreme Court has observed that the onus of proving the nature of sale whether it is interstate or intrastate is on the revenue. Section 6-A of the CST Act, reverses the principles and throws the burden on the assessee to prove that the transaction is not a sale prior to the date of coming into force of the amendment made to Sub-section (1) of Section 6-A of the CST Act, that is prior to 11th May 2002. The filing of form 'F' by a dealer who sent the goods to another State on consignment or stock transfer was optional and he could prove his claim for non-levy of tax under the Act by producing alternative evidence such as correspondence, delivery challans, etc. Submission of "F" form declarations is not conclusive evidence that the movement of goods is a branch transfer/stock transfer and not a sale. The sales tax authorities can investigate and make enquiries whether the declaration is genuine and true and reject the 'F' forms, if the transaction is found to be not genuine. Section 6-A of the CST Act lays down a particular mode of proof and it is implied that the production of such proof will dispense with the necessity of adducing any other or further evidence and will suffice for the grant of the benefit. But Section 6-A(2) of the CST Act goes a little further and provides for the possibility of an enquiry being conducted by the assessing authority. It is open to the assessing authority to make further enquiry to satisfy himself that the particulars contained in form 'F' declarations are true. It is only then that the assessing authority is enjoined to pass an order in the matter. An order passed under Section 6-A(2) of the CST Act is nothing but a step in aid or process, which leads only to the ultimate computation of assessment of tax liability. In other words, Section 6-A(2) of the CST Act authorises the assessing Officer to make enquiry that particulars contained in the declaration furnished by the dealer are true and for this purpose, other evidence produced by the dealer is also requires to be considered. The assessing authority is also authorised under Section 6-A(2) of the CST Act to call for other information to verify the correctness of the particulars contained in the 'F' form declarations. It is for the dealer to prove that the details provided in form 'F' are correct and true. The Madras High Court in the case of D. Dhandapani v. State Of Tamilnadu , while interpreting the provisions of Section 6-A(2) of the CST Act has observed that even after submission of 'F' forms, the authority can make further enquiry to satisfy himself that particulars contained in the declaration in 'F' form are true and correct. If the dealer fails to satisfy the assessing authority about the genuineness and the correctness of the contents in 'F' form declarations, the transfer of goods can be taken as on account of interstate sales. Sub-section (2) of Section 6-A of the CST Act places a duty on the assessing authority to scrutinise the declarations furnished by the dealer and pass an order accepting the correctness thereof. On such an order being passed, the transfers made by the dealer to the out of State branches or agents will be deemed to have been made otherwise than as sales. The assessing authority has the power to make further enquiries to have an independent verification of the particulars furnished by the dealer in the declarations and other documents furnished by the dealer and in the course of enquiry, it is open to the assessing authority to call for any other information from the dealer in order to verify the truth or otherwise of the particulars contained in the declaration in 'F' form and the other information maintained by the dealer in its regular course of business. This appears to be settled legal position in law. Therefore, reference to various decisions of this Court and other Courts may not be necessary.

17 In pursuance to the remand order passed, the assessing authority had directed the asessee to produce the books of accounts and other records, if any, to support its claim of branch transfers and to ascertain the genuineness of such stock transfers. Inspite of issuing several notices, the assessee had failed to produce any documentary evidence to show that there has been branch transfer of goods and no inerstate sales were effected during the assessment period in question. As we have already noticed, the burden is on the assesseee to prove that the transaction is not a sale but a branch transfer or a consignment sale, but though several opportunities were provided to the assessee to discharge its burden as prescribed under Section 6-A of the CST Act, it has failed to do so, and therefore, the assessing authority had no other option but to reject the form ''F' declarations filed by the assessee."

It is also relevant to quote paragraphs 108, 109 and 110 of the IInd Ashok Leland (supra) Case in this context, which are as follows:-

"108. In Sahney Steel (supra) whereupon reliance has placed by the assessing authority, a contention was raised that the registered office and the branch office were separately registered as dealers under the sales tax law and transaction effected by the branch office should not be identified with transactions effected by the registered office. Pathak, J., as the learned Chief Justice-then was, observed; [SCC p.177, para 8] :

"We are unable to agree. Even if, as in the present case, the buyer places an order with the branch office and the branch office communicates the terms and specifications of the orders to the registered office and the branch office itself is concerned with the sales dispatching, billing and receiving of the sale price, the conclusion must be that the order placed by the buyer is an order placed with the Company and for the purpose of fulfilling that order the manufactured goods commence their journey from the registered office within the State of Andhra Pradesh to the branch office outside the State for delivery of the goods to the buyer."

109. The Court in the facts of that case held that the movement from the head office to the branch office was for the purpose of delivery to the branch office, thereafter to the buyer through the branch office. The branch office merely acted as a conduit through which the goods passed on their way to the buyer. It is, however, relevant to note that the Court noticed:[SCC.178, para 8]

"It would have been a different matter if the particular goods had been dispatched by the registered office at Hyderabad to the branch office outside the State for sale in the open market and without reference to any order placed by the buyer. In such a case if the goods are purchased from the branch office, it is not a sale under which the goods commenced their movement from Hyderabad. It is a sale where the goods moved merely from the branch office to the buyer."

110. The purpose of verification of the declaration made in Form-F, therefore, is as to whether the branch office acted merely as a conduit or the transaction took place independent to the agreement to sell entered into by and between the buyer and the registered office or the office of the company situated outside the State. The said decision, therefore, does not run counter to our reading of the said provision. Furthermore, the question which has been raised before us had not been raised therein."

Even for the limited inquiry under Section 6-A as referred in para 102 and 110 of IInd Ashok Leyland case (supra) and as is mentioned in the Division Bench judgment CPK Trading Co. Case (supra), for ascertaining the truth of the particular mentioned in Form-F the assessing authority is entitled to summon the relevant records as referred earlier. The Revisionist not having produced the records inspite of notice, it failed to discharge the burden under Section 6-A(2), therefore, the assessing and appellate authorities correctly treated the transaction as deemed Inter State Sale.

The Division Bench judgments quoted above relate to a period prior to 2002 as is the case at hand.

To contend as Sri Sachdeva did that no cogent reasons have been given for treating the transaction as sale is misconceived, as, the burden of proof, as stated above, was upon the Revisionst dealer which failed to discharge it, therefore, the the transactions have rightly been deemed as Inter-State sale under Section 6A-2 of the Act, 1956.

As regards the judgments relied by the learned counsel for the Revisionist one of which i.e. IInd Ashok Leyland case (supra) has already been dealt with hereinabove. As far as the case of Seagram Manufacturing Pvt. Ltd. (supra) is concerned in the said case an order accepting Form-F had been passed which is not the case here. In Shree Akkamamba Textiles Ltd., (supra) also the assessing authority had allowed the exemption, therefore, his order was conclusive proof that the transaction in question was not a sale in view of the judgment of the Supreme Court in the IInd Ashok Leyland case (supra) which normal is also not the case here. In Parry Agro also Form-F was accepted during assessment proceedings, therefore, reopening of the issue was held to be bad in view of IInd Ashok Ley Land Case which is not the case here. In Eternit Everest Ltd.(supra) the Madras High Court found that the assessing authority had not conducted any exercise to consider the particulars of Form-F, therefore, it remanded the matter back. In North Star India (P) Ltd. (supra) also the Court found that no finding of there being any error in Form-F was recorded, therefore, the dealer was held to have discharged its burden under Section 6-A of the Act, whereas in the case at hand the dealer did not discharge the burden as he did not produce the relevant records demanded by the officer to facilitate the exercise under Section 6-A as has been mentioned earlier, therefore, the said case is not applicable. The decision in Kunj Bihari Lal Radheyshyam vs. Commissioner, Commercial Tax decided on 06.09.2014 by the High Court of Allahabad also does not help the Revisionist as it does not lay down any proposition of law different from the one discussed hereinabove. In fact it says that a case involving claim under Section 6-A of the Act stands on a different footing than the case of an Inter-State sale against Form-C.

The fact that tax on alleged sale of the goods in question by the Clearing and Forwarding Agents in Rajashthan has been paid in the said State, assuming it to be so, it is inconsequential for determining the issue whether it was an Inter-State sale and liable to tax under Section 6 of the Act, 1956 by the authorities U.P.

For the reasons aforesaid the decisions cited by Sri Karan Sachdeva do not help his cause.

In view of what has been stated above question no. (I) is answered in affirmative, question no.(ii) is answered in negative. With regard to question no.(iii) it has already been stated hereinabove that the burden to prove that the transaction was of transfer of goods otherwise than by way of Sale was on the Revisionist-dealer and for the reasons aforesaid this burden was not discharged consequently the transaction has rightly been deemed to have been a Sale Inter-State as per Section 6-A(2) of the Act, 1956. As regards question no.(iv) the learned counsel for the Revisionist did not press the Revision on this question, therefore, this question has not been considered.