Chem Limited v. Madras Petro-STATE of Tamil Nadu — 1998 DIGILAW 147 (MAD)

Judgment :- N. V. BALASUBRAMANIAN, J. The tax case appeal is filed against the order of the Joint Commissioner II in reference No. M4/4544/83, dated January 28, 1985 passed in exercise of the suo motu revision by the Joint Commissioner II, Office of the Commissioner of Commercial Taxes, Chepauk, Chennai revising the order of the Appellate Assistant Commissioner (C.T.), Kancheepuram. 2. Tvl. Nagpal Petro Chemicals Limited, Manali, Madras was initially assessed for the assessment year 1976-77 on the taxable turnover of Rs. 3, 75, 23, 092 under the provisions of the Central Sales Tax Act, 1956 (hereinafter referred to as "the CST Act"). 3. The dealers claimed deduction from the total turnover for the assessment year 1976-77 a sum of Rs. 12, 72, 478.78 on account of sales return and credit notes issued by them. The assessing officer rejected the claim of the assessee-dealer on the ground that the claim for sales return can be made only on the issue of credit notes and, therefore, the appropriate year for making the claim for sales return would be the year in which the credit notes were issued. He, therefore, held that in respect of the sales return in which the credit notes were issued in the subsequent year, viz., 1977-78, the claim of the assessee can be considered only in the year 1977-78 and completed the assessment rejecting the claim of the assessee for deduction towards the sales return. The assessee preferred an appeal to the Appellate Assistant Commissioner objecting to the disallowance of the claim of the assessee on sales return. The Appellate Assistant Commissioner in a brief order followed the decision of this Court in Traders and Traders v. State of Tamil Nadu and held that the claim for the sales return can be claimed in the year in which the sales were effected and therefore, the assessee was eligible to claim the deduction for the sales return amounting to Rs. 7, 86, 839.70 in the assessment year 1976-77. 4. The Joint Commissioner II, Commercial Taxes Department, Chennai on a perusal of the records, found that the assessee was granted, inter alia, the deduction of the turnover of a sum of Rs. 8, 16, 675.60 representing the sales return in respect of four invoices mentioned below : (i) 552/21-10-76 .. Rs. 91, 852.80 (ii) 610/17-1-77 .. Rs. 2, 70, 862.80 (iii) 624/12-2-77 .. Rs. 8, 16, 675.60 representing the sales return in respect of four invoices mentioned below : (i) 552/21-10-76 .. Rs. 91, 852.80 (ii) 610/17-1-77 .. Rs. 2, 70, 862.80 (iii) 624/12-2-77 .. Rs. 1, 81, 584.00 (iv) 650/18-3-77 .. Rs. 2, 72, 376.00 Total .. Rs. 8, 16, 675.60 The Commissioner noticed that the subsequent investigation revealed that the goods rejected by M/s. Bharat Heavy Electricals Limited, Bhopal (for short, "BHEL") were not received back at Madras, but were taken to depots at Bombay and Delhi and disposed of in other States and the dealers were not able to correlate the rejection with the sales invoices concerned. The Joint Commissioner, therefore, felt that the exemption granted on the turnover at Rs. 8, 16, 676 was erroneous and it should be subject to the tax at the rate of 10 per cent and issued a show-cause notice to the assessee to revise the order of assessment. The assessee-dealer by letter dated October 4, 1983 set out the facts regarding the sale of the goods to M/s. Bharat Heavy Electricals Limited, Bhopal, and submitted that the goods after rejection by BHEL remained at the risk of the supplier and instead of taking back the goods and bringing it to Madras, the goods were despatched from Bhopal to their sales offices at Bombay and Delhi where the dealers have godowns. The goods rejected were taken into stock at Bombay and Delhi, and thereafter were sold to new customer and therefore, there was a sales return of the goods. It was pleaded that it was a case of section 3(b) sale by transfer of documents and the movement of the goods was terminated by BHEL at Bhopal and the goods were thereafter rejected and the rejected goods were resold at Bombay and Delhi. The dealer had, therefore, stated that the proposal initiated by the Joint Commissioner to assess the turnover was not proper. 5. The Joint Commissioner, after considering the objection and after hearing the parties, held that the goods were sent to Bhopal from the State of Tamil Nadu as a result of a contract of sale and the fact that the goods sent to Bhopal were not actually returned to the assessee-dealer at Madras was admitted. 5. The Joint Commissioner, after considering the objection and after hearing the parties, held that the goods were sent to Bhopal from the State of Tamil Nadu as a result of a contract of sale and the fact that the goods sent to Bhopal were not actually returned to the assessee-dealer at Madras was admitted. The Joint Commissioner placed reliance on the decision of this Court in Thavakkal Agencies v. State of Tamil Nadu and held that inasmuch as the goods sold to the parties outside the State have not come back, the transaction could not be termed as a sales return and therefore, the assessee was not entitled to the deduction and the transaction was liable to be taxed since the turnover was not covered by "C" form. The Joint Commissioner held that the said turnover should be assessed at the rate of 10 per cent and accordingly, passed the impugned order. It is against this order, the present appeal is filed. 6. Mr. C. Natarajan, learned Senior Counsel appearing for the assessee, submitted that there can be a number of inter-State sales during a single movement of the goods which are exempt under certain conditions but otherwise taxable which is contemplated under section6 of the CST Act. He submitted that the Legislature was not obliged to provide for the deduction under section8A of the CST Act in respect of the sales turnover once a taxable event of sale occurs. However, the Parliament has provided for certain deductions from the sale price of all goods returned to the dealer by the purchaser of such goods within a period of six months from the date of delivery of the goods. He further submitted that section8A of the CST Act would operate in a case where there is a concluded sale and sale price accrued in favour of the dealer which would form part of the turnover. Section 8A of the CST Act provides that the goods shall be returned to the dealer by the purchaser within a period of six months from the date of the delivery of the goods and the section does not refer to the place where the goods should be returned and the provision has not contemplated the return of the goods at the place of despatch. He emphasised the words, "from the date of delivery" in section8A of the CST Act and submitted that the delivery is a voluntary transfer of possession from one person to another and all the conditions of section 8A would be satisfied, if there is a retransfer of possession of goods to the seller within a period of six months of the original transfer of possession to the buyer and section 8A would operate irrespective of the fact where such return takes place. He submitted that the expression, "return" has several meanings and in the context of section8A of the CST Act, it need not necessarily mean, "merchandise brought back to the seller" and the conditions of section8A of the CST Act would be satisfied when the goods are taken back by the seller. He referred to the provisions of the Sale of Goods Act, 1930 with reference to the right of the buyer not to accept the goods, right of rejection and right to refuse to accept the goods and submitted that section8A of the CST Act would operate in a case where the goods are returned to the selling dealer and the expression, "dealer" in section 8A of the CST Act should be construed in the light of the definition of "dealer" in section2(b) of the CST Act. He, therefore, submitted that when the goods are returned to the agent or the branch office of the seller, it is a return to the dealer within the meaning of section8A of the CST Act. He submitted that when a dealer referred to in section2(b) of the CST Act obtained the possession of the goods returned even through the agent or a local branch, it should be construed as a return of the goods to the selling dealer. He, therefore, submitted that commercial course of events have to be taken note of by this Court and the provisions of section 8A should be construed in a fair manner and there cannot be any insistence that the goods should actually come back to the selling dealer in the State of Tamil Nadu. He, therefore, submitted that if the view of the Joint Commissioner that the goods must physically come back to the selling dealer in the State of Tamil Nadu is accepted, it will cause great hardship and result in anomalous results. He, therefore, submitted that if the view of the Joint Commissioner that the goods must physically come back to the selling dealer in the State of Tamil Nadu is accepted, it will cause great hardship and result in anomalous results. He, therefore, submitted that the grant of deduction under section8A of the Act is subject to safeguards and the authorities are competent to examine the reason for return, evidence of return and refund of price, and only in the case of genuine transactions, the benefits of section8A of the CST Act would be available to the assessee-dealer. He submitted that there is no difference between the head office and a branch office of the same company and the branch is only an agency of the company and the fact that there is a separate registration for the branch office would not confer a personality distinct from the firm or company and therefore, when the goods were returned by the buyer at Bhopal to an agent at Bhopal of the selling dealer, it must be taken as a sales return to the selling dealer and the order of the Joint Commissioner that the goods must physically come back to the State of Tamil Nadu is not sustainable in law. In support of his contentions, he relied upon the following decisions : (i) Sahney Steel and Press Works Ltd. v. Commercial Tax Officer (ii) Sri Ganesan Traders v. Union of India (iii) Metal Alloy Company Pvt. Ltd. v. Commercial Tax Officer (iv) P. K. Unni v. Nirmala Industries (v) Commissioner of Income-tax, Punjab v. Kulu Valley Transport Co. (P) Ltd. (vi) B. N. Shankarappa v. Uthanur Srinivas (vii) Commissioner of Sales Tax v. Auraiya Chamber of Commerce (viii) Deputy Commissioner of Sales Tax (Law) v. Motor Industries Co. (ix) Bayyana Bhimayya & Sukhdevi Rathi v. Government of Andhra Pradesh (x) Duni Chand Rataria v. Bhuwalka Brothers Ltd. (xi) Thavakkal Agencies v. State of Tamil Nadu (xii) Traders and Traders v. State of Tamil Nadu (xiii) Richardson Hindustan Limited v. State of Maharashtra (xiv) Grasim Industries Limited v. State of Kerala (xv) Dhandapani v. State of Tamil Nadu (xvi) A batch of cases found in Halsbury's Laws of England (Fourth Edition - Vol. 41) at para 757 and (xvii) Benjamin's Sale of Goods (Second Edition), pages 5, 23 and 33. 7. 41) at para 757 and (xvii) Benjamin's Sale of Goods (Second Edition), pages 5, 23 and 33. 7. Learned Government Advocate on behalf of the State submitted that the fact remains that the goods were not returned by the purchaser to the dealer in the State of Tamil Nadu and only when the goods find their way to the dealer in the State of Tamil Nadu, it is open to the assessee-dealer to claim the deduction under section8A of the CST Act. He further submitted that the provisions of section 8A contemplates that the assessee must lead satisfactory evidence for such return of the goods and refund of the sale price. He further submitted that the implication of the proviso to the section is that the assessing officer must be satisfied that there was a return of goods and it is possible only when the goods are physically returned to the dealer in the State of Tamil Nadu. He submitted that if the buyer returns the goods to the agent of the dealer outside the State of Tamil Nadu by means of some delivery orders, it may be a sales return under the general law, but in so far as the CST Act is concerned, it is a special law and the Act contemplates that the assessing officer must be satisfied that there is a return of the goods and unless the goods are returned to the State of Tamil Nadu, it is not possible for the assessing officer to be satisfied himself that there was a return of the same goods. He further submitted that it is true that there may be several inter-State sales during the course of a single movement of the goods from one State to another, but if the goods are ultimately rejected, the goods must find a way to the State of origin and then only, the assessee can claim the deduction under section8A of the CST Act. The further submission of the learned Government Advocate is that section 8A is a provision to grant deduction and it should be construed in a very strict manner and if the assessee's contention is accepted, it will lead to tax evasion as it is not possible for the authorities in the State of Tamil Nadu to verify whether the goods were actually returned to the agent in an outside State and if the assessing officer has to satisfy himself on the basis of some delivery orders that there is a sales return, it will lead to a situation that the local agent may sell the goods outside the State avoiding the levy of Central sales tax in the State of Tamil Nadu. He further submitted that the decision in Thavakkal Agencies v. State of Tamil Nadu would squarely apply to the facts of the case and once the goods were sold to the party outside the State, but they have not come back, the transaction could not be termed as sales return and the State must be empowered to levy tax when the goods moved from the State of Tamil Nadu in pursuance of the contract of sale. He also submitted that section8A of the CST Act, read with the other provisions of the Act, provides that when the assessee wants to have deduction on a sales return, the goods must physically come back to the State of Tamil Nadu and then only, the assessee can be permitted to claim deduction on the sales return. 8. We have carefully considered the rival submissions of the learned counsel for the parties. The legislative history of the Central Sales Tax Act was dealt with by one of us, Mr. M. S. Janarthanam, J., in Sri Ganesan Traders v. Union of India and this Court after noticing the legislative history and various amendments in the context of section6A of the CST Act, summarised the provisions as under : "Section 3 of the Central Act, which had been enacted pursuant to such constitutional provision, seeks to tax not goods involved in branch transfer, but only goods involved in inter-State sale. The word 'sale' appearing in section 2(g), as also in section3(a) of the Central Act, includes an agreement to sell also provides that agreement contains a stipulation regarding passing of the property. The word 'sale' appearing in section 2(g), as also in section3(a) of the Central Act, includes an agreement to sell also provides that agreement contains a stipulation regarding passing of the property. But in order to determine whether a sale has taken place in the course of inter-State trade or commerce, the matter has to be approached only after a concluded sale has taken place, because unless the sale takes place or, in other words, the agreement to sell merges into a concluded sale, the question regarding the application of the provisions of the Central Act does not arise at all, because the tax is on sale and not on an agreement to sell or a forward contract. Before a sale can be said to take place in the course of inter-State trade or commerce, the following conditions must be satisfied : (1) There is an agreement to sell, which contains a stipulation, express or implied, regarding the movement of the goods from one State to another. (2) In pursuance of that agreement, the goods in fact moved from one State to another. (3) Ultimately, a concluded sale took place in the State where the goods were sent and that State is different from the State, from which the goods moved.If these conditions are satisfied, as already indicated then, by virtue of section9 of the Central Act, it is the State, from which the goods moved, which would be competent to levy tax under the provisions thereof. Thus, the inter-State sale of goods of description, as mentioned in section 3 alone is taxable or chargeable under section 6. Subsequently, section6A of the Central Act prescribing a declaration in form 'F' had been inserted and come into force with effect from April 1, 1973. The question is as to whether rule 4(3A) is inconsistent with the provisions of section 6A and rule 12(5). The answer to such a question is traceable, with ease and grace, if one is able to understand the reason why section 6A and rule 12(5) prescribing a declaration in form 'F' had been made. The statement and object clause for enactment of such a provision, as had been extracted earlier, if perused, would point out that those provisions had been enacted mainly to prevent dealers trying to show even genuine sales to third parties as transactions of the type of branch transfer. The statement and object clause for enactment of such a provision, as had been extracted earlier, if perused, would point out that those provisions had been enacted mainly to prevent dealers trying to show even genuine sales to third parties as transactions of the type of branch transfer. What had been enacted under those provisions was relatable to burden of proof in case of transfer of goods claimed otherwise than by way of sale, casting squarely on the shoulders of the dealers, which was hitherto on the Revenue. Under section 6A(1) the burden is on the dealer to prove that the movement of the 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 to his agent or principal outside the State. The burden so cast on the dealer may be discharged, by furnishing a declaration, as prescribed in form 'F', along with evidence of despatch of such goods. Furnishing of declaration in form 'F' is not compulsive or mandatory. It is open to the dealer to discharge the burden of proof cast on him in any other manner by adducing other evidence. In case where the dealer exercises the option of furnishing declaration in form 'F', 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 so furnished by the dealer 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) points out that in case where the dealer exercises option of furnishing declaration in form "F", 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 the enquiry by the assessing authority is limited to this extent, namely, to verify whether the particulars contained in the declaration in form "F" furnished by the dealer are true. It means that 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 the facts or accurate or genuine. It means that 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 the facts or accurate or genuine. That alone is the scope of the enquiry contemplated by section 6A(2)." The above judgment was affirmed by a Division Bench of this Court in Dhandapani v. State of Tamil Nadu. 9. The concept of sales return in the context of Tamil Nadu General Sales Tax Act was dealt with by a Full Bench of this Court in Traders and Traders v. State of Tamil Nadu and the following passage in the judgment is relevant for the purpose of this case : "It often happens in the business world that a customer who has purchased a commodity from a dealer might wish to return it for some reason, and the dealer may also be agreeable to that course and be willing to refund the price. If both the parties act according to their second thoughts in the manner aforesaid, what happens is a sales return, as it is described in the fiscal jargon. But this does not abrogate the sale or render it, retrospectively, a nullity. On the contrary, it takes note of the circumstance that the earlier sale is an accomplished fact. Only the parties agreed to put themselves in the former position, the status quo ante, by consensual overt acts - the one returning the goods and the other refunding the price. Technically, therefore, on the theory that sales tax attaches at the moment of sale, there is no call for making any provision in the taxing Act for giving any relief to the dealer whose sale, which is subject to a subsequent return, is chargeable to tax." 10. The Supreme Court in Deputy Commissioner of Sales Tax (Law) v. Motor Industries Co. [1983] 53 STC held that the deduction in respect of sales return has to be claimed in respect of that financial year in which the sale took place and cannot be claimed in the assessment proceedings for a financial year subsequent to the financial year in which the sales took place. The Kerala High Court in Grasim Industries Limited v. State of Kerala considered the concept of sales return as under : "A sales return means a return of the very goods purchased by the buyer in whole or in part. The Kerala High Court in Grasim Industries Limited v. State of Kerala considered the concept of sales return as under : "A sales return means a return of the very goods purchased by the buyer in whole or in part. It is a reversal of the sale, as if the sale had not taken place in respect of the returned goods, and therefore contemplates a return before the goods are appropriated and used by the buyer. A return of the left overs after use cannot be equated with a sales return. The return should be of goods of the same nature and quality as those supplied. The identity in chemical composition may not be relevant if the physical characteristics were also part of the conditions of supply. The return of cut-ends or trimmings when the supply agreed was of pulp sheets cannot qualify for deduction under section 8A(1)(b) though the chemical composition and characteristics continue to be the same." 11. The Bombay High Court in Richardson Hindustan Ltd. v. State of Maharashtra held that the concept of sales return would arise only after the goods were sold. The Bombay High Court also held that once the goods sold are returned to the selling dealer by the purchase within the prescribed period for one reason or other, the assessee is entitled to refund. In Sahney Steel and Press Works Ltd. v. Commercial Tax Officer, the Supreme Court was dealing with a case of placing an order with the branch office and in that case, the branch office communicated the terms and specifications of the order to registered office and the Supreme Court held that the registered office and the branch office are the offices of the same company and they do not posses separate juridical personalities. The Supreme Court therefore held that the movement of the goods from one State to another occasioned by the order placed by the customer was an incidental to the contract and till the goods are delivered, it is an inter-State movement attracting the provisions of sections 3(a) of the CST Act. The Supreme Court in that case considered the earlier law on the subject and held that where the movement of the goods from one State to another is incidental to the contract, it is an inter-State sale and what is decisive is the movement of the goods from one State to another. 12. The Supreme Court in that case considered the earlier law on the subject and held that where the movement of the goods from one State to another is incidental to the contract, it is an inter-State sale and what is decisive is the movement of the goods from one State to another. 12. In Metal Alloy Company Pvt. Ltd. v. Commercial Tax Officer, the Calcutta High Court made a distinction between the return of the goods and rejection of goods and in the case of return of the goods, there is a bilateral transaction brought about by the consent of the seller and the purchaser, which consent may have been effected either prior to the delivery of the goods or subsequent to such delivery. The Calcutta High Court held that in the case of rejection of goods, there is an unilateral transaction governed by the provisions of the Contract Act or the Sale of Goods Act, open to the purchaser. In this context, we may refer to some of the decisions relied upon by the learned Senior Counsel for the assessee. In Commissioner of Sales Tax v. Auraiya Chamber of Commerce the Supreme Court held that even in a fiscal statute, equity should prevail wherever language permits. The relevant passage of the Supreme Court reads as under : "The rights and the obligations of the parties must be found within the four corners of the Act and this Court in an appeal under and Act must act under the four corners of law but in interpreting the relevant procedural provisions, fairness and justice should be the approach and even in a fiscal statute, equity should prevail wherever language permits." 13. In P. K. Unni v. Nirmala Industries, the following observation of the Supreme Court is relevant for the purpose of this case : "The court must indeed proceed on the assumption that the Legislature did not make a mistake and that it intended to say what it said : See Nalinakhya Bysack v. Shyam Sunder Haldar at page 545; at page 152. Assuming there is a defect or an omission in the words used by the Legislature, the court would not go to its aid to correct or make up the deficiency. The court cannot add words to a statute or read words into it which are not there, especially when the literal reading produces an intelligible result. Assuming there is a defect or an omission in the words used by the Legislature, the court would not go to its aid to correct or make up the deficiency. The court cannot add words to a statute or read words into it which are not there, especially when the literal reading produces an intelligible result. 'No case can be found to authorise any court to alter a word so as to produce a casus omissus'. : Per Lord Halsbury, Mersey Docks v. Henderson 1888 (13) AC 595, 602. 'We cannot aid the Legislature's defective phrasing of an Act, we cannot add and mend, and, by construction, make up deficiencies which are left there' : Crawford v. Spooner (1846) 6 Moore PC 1, 8, 9.Where the language of the statute leads to manifest contradiction of the apparent purpose of the enactment, the court can, of course, adopt a construction which will carry out the obvious intention of the Legislature. In doing so 'a Judge must not alter the material of which the Act is woven, but he can and should iron out the creases' : Per Denning, L.J., as he then was, Seaford Court Estates v. Asher. See the observation of Sarkar, J., in M. Pentiah v. Muddala Veeramallappa." 14. In Commissioner of Income-tax, Punjab v. Kulu Valley Transport Co. (P.) Ltd. the Supreme Court held that where two views are possible in a legislation of a statute, a view favourable to the assessee must be accepted while construing the provisions of a taxing statute. In B. N. Shankarappa v. Uthanur Srinivas the Supreme Court again reiterated that the provisions of an Act must be construed to avoid avoidable hardship and complications. In Duni Chand Rataria v. Bhuwalka Brothers, the Supreme Court when construing the provisions of the West Bengal Jute Goods Future Ordinance, 1949, construed the words, "actual delivery of possession" and held as under : "If the narrow construction which was put by the Appeal Court on the expression 'actual delivery of possession' was accepted it would involve each one of the intermediate parties actually taking physical or manual delivery of the goods from their sellers and again in their turn giving physical or manual delivery of the goods which they had thus obtained to their immediate buyers. Such an eventuality could never have been contemplated by the Government and the only reasonable interpretation of the expression 'actual delivery of possession' can be that actual delivery as contrasted with mere dealing in differences was within the intendment of the Ordinance and such actual delivery of possession included within its scope symbolical as well as constructive delivery of possession."The Supreme Court in the same case further held as under : " The mate's receipts or the delivery orders as the case may be, represented the goods. The sellers handed over these documents to the buyers against cash payment, and the buyers obtained these documents in token of delivery of possession of the goods. They in turn passed these documents from hand to hand until they rested with the ultimate buyer who took physical or manual delivery of possession of those goods. The constructive delivery of possession which was obtained by the intermediate parties was thus translated into a physical or manual delivery of possession in the ultimate analysis eliminating the unnecessary process of each of the intermediate parties taking and in his turn giving actual delivery of possession of the goods in the narrow sense of physical or manual delivery thereof. 15. In Bayyana Bhimayya & Sukhdevi Rathi v. Government of Andhra Pradesh the Supreme Court held that the delivery order is a document of title to goods and the possessor of such a document has a right not only to receive the goods but also to transfer it to another by endorsement or delivery. The Supreme Court in the abovesaid case was dealing with the following factual situation. The appellants agreed to purchase gunnies at a certain rate for future delivery and the mills also agreed to deliver the goods to third parties proposed by the appellants. Before the delivery of the gunnies, the appellants entered into a contract with third parties and handed over to them the delivery orders and the mills delivered the goods against the delivery orders. In that factual situation, the Supreme Court held that at the moment of delivery by the mills to the third parties, there were two deliveries, one by the mills to the appellants and other by the appellants to the third parties as buyers from the appellants. In that factual situation, the Supreme Court held that at the moment of delivery by the mills to the third parties, there were two deliveries, one by the mills to the appellants and other by the appellants to the third parties as buyers from the appellants. According to the Supreme Court these two deliveries might synchronise in point of time, but were separate, in point of fact and in the eye of law. 16. The expression, "sale" is defined in section2(g) of the CST Act. The expression "dealer" is defined in section2(b) of the CST Act. Section 3 of the CST Act formulates the principles for determining when a sale or purchase of goods takes place in the course of inter-State trade or commerce or outside a State or in the course of import or export. Admittedly, it is a case failing under section3(b) of the CST Act. Explanation 1 to section3 of the CST Act is relevant and the Explanation reads as under :" Where goods are delivered to a carrier or other bailee for transmission, the movement of the goods shall, for the purposes of clause (b), be deemed to commence at the time of such delivery and terminate at the time when delivery is taken from such carrier or bailee. "We are not concerned with section4 or section5 and under section6 of the CST Act, the liability to tax on inter-State sales is imposed. Section 6A is also relevant for the purpose of this case, which deals with the burden of proof in the case of transfer of goods claimed otherwise than by way of sale. We do not want to burden the judgment with section7 or section8 of the Act. Section 8A of the CST Act provides for determination of turnover. We are concerned with section 8A(1)(b) which deals with the sales return and the relevant provision reads as under :" * In determining the turnover of a dealer for the purposes of this Act, the following deduction shall be made from the aggregate of the sale prices, namely : (a) ................. We are concerned with section 8A(1)(b) which deals with the sales return and the relevant provision reads as under :" * In determining the turnover of a dealer for the purposes of this Act, the following deduction shall be made from the aggregate of the sale prices, namely : (a) ................. (b) the sale price of all goods returned to the dealer by the purchasers of such goods - (i) within a period of three months from the date of delivery of the goods, in the case of goods returned before the 14th day of May, 1966;(ii) within a period of six months from the date of delivery of the goods, in the case of goods returned on or after the 14th day of May, 1966 : Provided that satisfactory evidence of such return of goods and of refund or adjustment in accounts of the sale price thereof is produced before the authority competent to assess or, as the case may be, reassess the tax payable by the dealer under this Act. "It is only in the light of the mandate prescribed under section8A of the CST Act, the question whether in the case of sales return the goods must come back to the State of origin has to be decided. 17. The case set up by the assessee-dealer in the letter dated October 4, 1983 was that the goods were sold by the assessee-dealer to the distributors M/s. Sikri and Grover who in turn resold the goods to M/s. Bharat Heavy Electricals Limited (BHEL), Bhopal, and in respect of the same, the assessee charged Central sales tax at 4 per cent against "C" from issued by M/s. Sikri and Grover. It is also stated that the tax was paid against the invoices and this formed part of the total turnover for the assessment year 1976-77. The transformer oil which was the goods sold was found not up to the satisfaction or the specifications required by BHEL and consequently, the goods were rejected by BHEL and the assessee's distributor M/s. Sikri and Grover accepted the same. It is clear that M/s. Sikri and Grover insisted that the assessee-dealer should accept the rejection of the goods and it is stated that they obtained the credit note from the dealer for the goods rejected. It is clear that M/s. Sikri and Grover insisted that the assessee-dealer should accept the rejection of the goods and it is stated that they obtained the credit note from the dealer for the goods rejected. It is pleaded that all the facts have been proved before the authorities and the rejection of the goods by BHEL resulted in reversal of the transaction. The goods on rejection by BHEL remained at the risk of the suppliers and instead of taking back the entire goods and bringing back to Tamil Nadu, the goods were despatched to Bombay and Delhi where the assessee-dealer have godowns. The goods rejected were taken into stock at Bombay and Delhi and thereafter sold to a new customer. It is also stated that the assessee-dealer produced evidence for the return of the goods to its depots at Bombay and Delhi. 18. The Joint Commissioner placed reliance on a decision of this Court in Thavakkal Agencies v. State of Tamil Nadu and held that the goods sent to Bhopal were not actually returned to the assessee-dealer at Madras and the transaction could not be termed as a sales return. We have already quoted the provisions of section8A of the CST Act. In our opinion, on a fair reading of section8A of the CST Act, there is nothing in section8A of the Act warranting the view taken by the Joint Commissioner that the goods must be returned to the State from which the sale originated. The statutory conditions prescribed in section 8A of the CST Act are (i) that within a period of six months from the date of delivery of the goods, the goods must be returned to the dealer; (ii) that satisfactory evidence of such return of the goods must be furnished before the assessing authority; and (iii) that the refund or adjustment on account of the sale price has also been made and the evidence to that effect must be produced before the authority competent who is assessing the dealer. If the assessee-dealer is able to satisfy the statutory conditions prescribed in section8A of the CST Act, the assessee would be entitled to deduction on the sales return. The section does not in any way contemplate that the goods must be returned to the place of despatch. If the assessee-dealer is able to satisfy the statutory conditions prescribed in section8A of the CST Act, the assessee would be entitled to deduction on the sales return. The section does not in any way contemplate that the goods must be returned to the place of despatch. The emphasis that is given in the section is that the goods must be returned to the dealer by the purchaser of the goods. The expression, "dealer" has to be construed in the light of the definition of the term "dealer" in section2(b) of the CST Act and the section does not contemplate the goods must also be returned to the dealer at the place of despatch of the goods. It is not permissible to read more into the sectionthat what is provided for in section8A of the CST Act for the assessee to claim deduction on the original sales return. If the view of the Joint Commissioner is accepted, it will create unintended hardship and as observed by the Supreme Court in B. N. Shankarappa's case avoidable hardships and complications should be avoided in construing the provisions of the Act. Though we agree with the contentions of the learned Government Advocate that the provisions of section8A of the CST Act should be construed in a strict manner, and unless the assessee complies with all the conditions prescribed under section8A of the CST Act, the assessee is not entitled to deduction towards the claim for sales return, it is to be noticed that while interpreting the provisions of a fiscal statute, fairness and justice should be taken into consideration and equity should prevail whenever language permits. It may not be a reasonable construction to ignore the plain and grammatical meaning of the words used and supply words by analogy or implication. It is not uncommon to find that in the case of an inter-State sale, even in the case of a single movement of the goods from one State to another, there can be a number of inter-State sales during the course of movement of goods from one State to another. It is not uncommon to find that in the case of an inter-State sale, even in the case of a single movement of the goods from one State to another, there can be a number of inter-State sales during the course of movement of goods from one State to another. The goods may originate from the State of Tamil Nadu and the ultimate destination may be the State of Maharashtra and during the course of inter-State sale, there may be several inter-State sales touching several States, like Andhra Pradesh, Madhya Pradesh, Union Territory of Delhi, State of Punjab, State of Uttar Pradesh and the State of Maharashtra and if the view that the goods must physically come back to the State of origin for the dealer to claim sales return is accepted, the resultant position would be that the goods must physically come back to all the States though which they passed from the State of origin to the ultimate State, and then only the dealer in each of the States would be able to claim deduction towards sales return. 19. The legislative-history traced in Sri Ganesan Traders' case suggests that the tax on goods moved from one State to another in the course of inter-State trade or commerce leads to the fulfilment of certain legal requirements pursuant to either Central or State legislation as a sequence of constitutional prescriptions. The resultant position is that we are having Central Act in hand and when it is not possible and plausible in commercial world that the goods must physically pass through several State for the dealer to claim deduction towards sales return and if the physical movement from one State to another is insisted upon, it will create great hardship. The court has to take note of commercial realities and it cannot be presumed that a procedural provision like section8A of the CST Act contemplates the physical return of the goods for the assessee to claim sales return. The court has to take note of commercial realities and it cannot be presumed that a procedural provision like section8A of the CST Act contemplates the physical return of the goods for the assessee to claim sales return. We are of the opinion that when the Parliament has not provided that the deduction towards sales return should be granted only when the goods are physically returned to the dealer in the State of origin, it is impermissible to construe the provisions of section8A of the CST Act that the goods must be physically returned to the dealer and to the place of despatch and if such a construction is placed upon the words in section 8A, in certain situation, it would defeat the very object of granting deduction towards sales return and we must remember that section8A of the CST Act has been enacted as a beneficial provision and we must construe the provisions of section 8A to achieve the purpose behind the section 8A and not to defeat it. 20. Much reliance was placed by the Joint Commissioner on the decision of this Court in Thavakkal Agencies v. State of Tamil Nadu. We have seen the facts of that case earlier and it is seen that the goods were delivered to a common carrier but before termination of journey as provided in section3(b) of the CST Act, there was a subsequent sale to a subsequent buyer and in that context, this Court held that there was no delivery of the goods to the original buyer and the movement of the goods continued in pursuance of the original sale contract and has not ceased and the sale to the subsequent buyer was during the movement of the goods and therefore, the transaction of inter-State was liable to be taxed under the Central Sales Tax Act. But, in the instant case, there was a concluded sale in favour of M/s. Sikri and Grover in Bhopal and only thereafter, M/s. Sikri and Grover sold the goods to BHEL, Bhopal. Secondly, in Thavakkal Agencies' the dealer was sought to be assessed in respect of inter-State sale to a subsequent buyer unlike in the instant case it is a case of sales return in respect of first inter-State sale and therefore, the decision of Thavakkal Agencies' case has no application to the facts of the case. 21. Secondly, in Thavakkal Agencies' the dealer was sought to be assessed in respect of inter-State sale to a subsequent buyer unlike in the instant case it is a case of sales return in respect of first inter-State sale and therefore, the decision of Thavakkal Agencies' case has no application to the facts of the case. 21. That apart, as we have seen, the expression, "return" has various shades of meaning and according to Black's Law Dictionary (Sixth Edition - at page 1318), it means" * to place in the custody; to restore; to redelivery; merchandise brought back to the seller". In our view, if the goods are taken back to the seller, it will amount to "return" of the goods. Further, the provisions of section8A of the CST Act do not contemplate the return of the goods to the place of despatch. No doubt, it is true that the deduction towards sales return can be claimed by the dealer only if the assessee-dealer is able to produced satisfactory evidence of the return of the goods to the dealer and refund or adjustment of the sales price before the authorities. Consequently, if the goods were sold and then returned to the selling dealer by the purchaser within the prescribed period for one reason or another, the assessee would be entitled to deduction towards sales return subject to the fulfilment of other conditions. We have also seen that the decision of the Kerala High Court in Grasim Industries Limited case, held that the sales return means the return of the very goods purchased by the buyer in whole or in part and it is a reversal of the sale and therefore, when the identity is lost or when the goods returned are not the same goods sold by the dealer, the assessee is not entitled to claim the deduction towards sales return. The Act contemplates that the assessee must be able to satisfy the authorities on the basis of the satisfactory evidence of return of the goods sold by the selling dealer to the buyer. It is open to the authorities to satisfy themselves on the evidence produced that the goods returned are the very same goods purchased by the buyer. It is also open to them to inspect the goods or depute another officer to inspect the goods. It is open to the authorities to satisfy themselves on the evidence produced that the goods returned are the very same goods purchased by the buyer. It is also open to them to inspect the goods or depute another officer to inspect the goods. But, in all cases, the question of satisfaction of the assessing officer depends upon the evidence that may be produced by the assessee-dealer. The provisions of section8A of the CST Act do not contemplate that the goods must be returned to the dealer at the place of despatch. We have already held that it is impermissible to read some words in the statute and when the legislation has not provided that the goods must come back to the place of despatch, it is not open to the authorities to insist that the goods must come back to the place of despatch. But, the assessee-dealer must be able to satisfy that there was a return of the goods through its dealer and if the assessee is not able to establish that the possession of the goods was transferred back to the dealer within a period of six months from the date of the original transfer, then the assessee would not be entitled to deduction under section8A of the CST Act even if other conditions are satisfied. 22. That apart, a reading of some of the provisions of the Sale of Goods Act, 1930, particular sections 37, 38, 41, 42 and 43 clearly gives us an indication that the buyer is not bound to return the goods to the selling dealer unless it was otherwise agreed, but it would be sufficient if he intimates the seller that he refused to accept the goods. Therefore, the provisions of section8A of the CST Act have to be construed in consonance with the general law under the Sale of Goods Act, and when the provisions of the Sale of Goods Act do not contemplate the physical retransfer or the physical possession of the goods by the buyer to the seller at the place of despatch, section8-A of the Act, in our opinion, should also be construed in consonance with the provisions of the Sale of Goods Act, 1930 in the matter of return of the goods by the buyer to the seller. 23. 23. In Duni Chand Rataria v. Bhuwalka Brothers 1995 AIR(SC) 182 the expression, "actual delivery of possession" was construed and the Supreme Court held that the delivery notes represent the goods and where the seller hands over the delivery notes to the buyer against cash payment, the buyer obtains it as a token of delivery of possession of the goods. But, in our view, the decision of the Supreme Court is not of much help to the assessee as the concept of sales return contemplates at least at one point of time, the transfer of physical possession of the goods by the buying dealer to the selling dealer. So also the decision of the Supreme Court in Bayyana Bhimayya & Sukhdevi Rathi v. Government of Andhra Pradesh, that the delivery order is a document of title is not very helpful in deciding the controversy before us. 24. We have seen that according to the assessee-dealer, M/s. Sikri and Grover at Bhopal is a distributor and there was a sale by the assessee-dealer to M/s. Sikri and Grover and the sale was a section 3(b) sale and the assessee also offered the same for the purpose of assessment under the CST Act and paid the tax also. When M/s. Sikri and Grover sold the goods to BHEL, BHEL did not accept the same, but returned the goods and at least at that point of time, there should have been a physical transfer of the goods in favour of M/s. Sikri and Grover. But, it is not further clear whether M/s. Sikri and Grover had entered into a separate contract with the assessee-dealer to transfer the goods in favour of the assessee-dealer. It is also not clear to whom M/s. Sikri and Grover returned the goods. If it is assumed that M/s. Sikri and Grover is an agent of the assessee-dealer at Bhopal, it cannot be assumed that M/s. Sikri and Grover acted on behalf of the assessee and returned the goods to itself. It is also not established when M/s. Sikri and Grover returned the goods to the godowns at Bombay and Delhi and whether the goods were returned to the dealer within a period of six months from the date of the delivery of the goods to M/s. Sikri and Grover. It is also not established when M/s. Sikri and Grover returned the goods to the godowns at Bombay and Delhi and whether the goods were returned to the dealer within a period of six months from the date of the delivery of the goods to M/s. Sikri and Grover. The assessee has not pleaded all the facts even before the Joint Commissioner and in the absence of any pleading of any evidence we are of the view, it is not possible to grant a second opportunity to the assessee to prove the essential facts before the joint Commissioner to show that it has fulfilled all the conditions prescribed under section 8-A(1)(b) of the CST Act. 25. That apart, we have already held that the assessee must establish that the goods were returned to the dealer. The submission of Mr. Natarajan, learned senior counsel for the assessee is that the goods were taken back by the dealer at Bhopal, viz., M/s. Sikri and Grover and M/s. Sikri and Grover was the distributor of the assessee. He has produced before us the copy of the distributor agreement entered into between the assessee and M/s. Sikri and Grover dated January 1, 1975. Though the assessee had pleaded that M/s. Sikri and Grover was the only agent of the assessee and it must also be regarded as dealer, the assessee has not established that M/s. Sikri and Grover was a dealer within the meaning of section2(b) of the CST Act. The assessee, no doubt, has pleaded that M/s. Sikri and Grover is the distributor of the assessee-dealer. We have seen that the assessee can claim deduction towords sales return only if the assessee is able to establish that the goods sold were returned to the dealer and unless the assessee has established that M/s. Sikri and Grover has returned the goods to a dealer within the meaning of section2(b) of the CST Act on the basis of the agreement for sales return between the assessee and M/s. Sikri and Grover, it is not open to the assessee to claim deduction towards sales return. It might have been true that BHEL, Bhopal did not accept the goods on the score that the goods sold were not up to the specifications, but the fact remains that the sale by M/s. Sikri and Grover to BHEL is an independent sale and when BHEL, according to the assessee, rejected the goods, it came back to M/s. Sikri and Grover. But the assessee has not pleaded anywhere that there was an agreement between the assessee in Madras and M/s. Sikri and Grover in Bhopal for the return of the goods and the assessee has also not proved when the goods were returned to the dealer. Though we accept the case of the assessee that for claiming deduction under section8A of the CST Act, the goods need not be physically returned or physically come back to the State of despatch, however, on the facts of the case, we are of the view, the case of the assessee must fail. Though learned senior counsel submitted that the matter should be remitted to the Joint Commissioner to examine the case of the assessee, we are of the view that the assessment year involved is 1976-77 and the Joint Commissioner passed the order in the year 1985 and after a period of 13 years, if the matter is remitted, no useful purpose will be served. In this view of the matter, we dismiss the tax case appeal. No costs.