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2006 DIGILAW 2170 (DEL)

U. B. ENGINEERING v. COMMISSIONER OF SALES TAX

2006-11-23

S.MURALIDHAR, VIKRAMAJIT SEN

body2006
JUDGMENT 1. This writ petition seeks the quashing of an order dated 25.2.2005 passed by the Appellate Tribunal, Sales Tax, Delhi in Rev-34/SIT/04-05 in Appeal No. 403/STT/03-04. 2. The facts in brief are that the petitioner company, engaged in the business of selling engineering and electronic goods in Delhi, is registered under the Delhi Sales Tax Act, 1975 as well as the Central Sales Tax Act, 1956 (CST Act). The petitioner purchases goods from the various suppliers outside Delhi in the course of inter-State trade and commerce. While such goods are in transit, the documents pertaining to the consignment are endorsed in favour of the local purchasers. Since such transactions are subsequent sales, they would be governed by Section 6(2) of the CST Act and would be exempted from tax provided that the local dealer, like the petitioner herein, submits to its Assessing Officer a c Form obtained from the purchaser and an E Form obtained from the supplier. 3. In the instant case, in respect of the Assessment Year 1998-99, the petitioner was assessed on 30.3.2001 by the learned Notified Authority (Ward-89) and the tax payable under the CST Act and the interest payable thereon was determined. A penalty was also levied since the petitioner was unable to furnish the requisite declaration in the E-II form from its suppliers and the requisite declaration in c form from its customers in support of its claim for relief under Section 6(2) of the CST Act, on a turnover of Rs. 1,64,28,383/-. 4. The petitioner filed an appeal against an order dated 30.3.2001 before the Additional Commissioner. The petitioner was, at this stage, able to produce the c Form but not the E Form. Therefore, by an order dated 28.11.2003, the learned Additional Commissioner granted partial relief to the petitioner while rejecting the relief sought under Section 6(2) of the CST Act. 5. The further appeal preferred by the petitioner against the said order dated 28.11.2003 was dismissed by the Appellate Tribunal, Sales Tax, Delhi on 30.7.2004. Since no one appeared for the petitioner, the Appellate Tribunal proceeded ex-parte and dismissed the appeal on merits after hearing the Counsel for the Department. 6. The petitioner then filed an application before the learned Tribunal seeking review of an order dated 30.7.2004. This review petition was dismissed by an order dated 9.9.2004. Since no one appeared for the petitioner, the Appellate Tribunal proceeded ex-parte and dismissed the appeal on merits after hearing the Counsel for the Department. 6. The petitioner then filed an application before the learned Tribunal seeking review of an order dated 30.7.2004. This review petition was dismissed by an order dated 9.9.2004. Thereafter, the petitioner moved a further application in December 2004 where it now stated as under: "The appellant received the order of the Additional Commissioner of Sales Tax passed by him on 28.11.2003 and till then the appellant had not received the E-II form which is evident from the form itself. The form EII was issued to AVN Engg. Co. on 29.12.2003 by the Sales Tax Department Ward 55, New Delhi. The said evidence could not be considered by the Additional Commissioner for grant of relief." Accordingly, it was prayed before the Tribunal: That the Tribunal be pleased to suo motu grant relief by way of the orders to allow and entertain the relief under Section 6(2) of the Central Sales Tax Act on production of E-II form in addition to relief already granted by Additional Commissioner." 7. The Tribunal perused the copy of the certificate in E-II form stated to have been issued to Mis. AVN Engineering Pvt. Ltd. (a registered dealer of Ward-55) and held as under: "The certificate is undated. It does not indicate the place and state from which the movement of the goods sold on various dates from 7.5.98 to 31.10.98 commenced in column C(i). It does not indicate the place and state to which the goods in question had been considered in column C(ii). While it indicates the number and date of the declaration in Form C received from the appellant company to be DP 0930319 dated 24.5.2002. it does not indicate the number and date of the railway receipt, trip sheet of lorry or any other document of other means of transport in column D(iv) so that the date of commencement of inter-State movement can be ascertained. It also does not indicate the description, quantity and value of the goods as required in column D(ii). it does not indicate the number and date of the railway receipt, trip sheet of lorry or any other document of other means of transport in column D(iv) so that the date of commencement of inter-State movement can be ascertained. It also does not indicate the description, quantity and value of the goods as required in column D(ii). While it indicates the registration certificate number issued to the certifying dealer from Ward-55 in Delhi, it does not indicate whether the certifying dealer had purchased the same goods in the course of inter-State or commerce during its movement from one state to another and if the said purchase was in turn certified in Form E-II or in Form E-II, land the serial number or numbers of such certificate or certificates." 8. The Tribunal observed that there was no explanation forthcoming from the petitioner "as to why it did not apply for and obtain the requisite C forms from its appropriate assessing authority earlier: and having obtained the same, why it did not make over its declarations in C Form to its suppliers earlier than on 24.5.2002 and why it could not obtain the requisite certificates in E-I/E-II Forms from its suppliers and produce the same before the learned Additional CST who was seized of the appellants appeal till 28.11.2003." 9. The Tribunal further noted that- "No memorandum of evidence as required under Rule 36(5) of the DST Rules, 1975 has been filed along with the appeal No. 403/STT/03-04 indicating clearly the date on which Mis. AVN Engineering Pvt. Ltd. made over their certificate to the appellant company and the circumstances in which they could not do so before the orders were passed by the learned Notified Authority on 30.3.2001 and by the learned Additional CST on 28.11.2003." 10. In the above circumstances, the Tribunal held that there was no warrant for exercising its power to suo motu review its earlier order dated 30.7.2004 and therefore, dismissed the application. 11. We have heard the submissions of Mr. Rajesh Mahna, the learned Counsel for the petitioner and Mr. Raj Kumar Batra, learned Counsel for the respondents. Mr. Mahna submits that the Tribunal erred in not permitting the petitioner to approach the Assessing Officer once again with the E-II Form now obtained by it for reconsidering its claim under Section 6(2) of the CST Act. Rajesh Mahna, the learned Counsel for the petitioner and Mr. Raj Kumar Batra, learned Counsel for the respondents. Mr. Mahna submits that the Tribunal erred in not permitting the petitioner to approach the Assessing Officer once again with the E-II Form now obtained by it for reconsidering its claim under Section 6(2) of the CST Act. He placed reliance upon the decision of this Court in Kirloskar Electric Co. Ltd. v. Commissioner of Sales Tax, 43 (1991) DLT 376 (DB)= 1991 (83) STC 485 (Delhi) and P.A. George v. Assistant Commissioner of Sales Tax, 110 STC 253 (Kerala). He further submitted that the Tribunal ought to have directed the Assessing Officer to rehear the matter instead of examining the E-II Form itself. He finally submitted that the defects pointed out by the Tribunal would constitute a curable irregularity and not an illegality warranting dismissal of the claim. In support of this submission, he placed reliance on the decision of this Court in Remfry & Sons v. Commissioner of Income Tax, 118 (2005) DLT 720=276 ITR I (Delhi). 12. In reply, Mr. Raj Kumar Batra, learned Counsel for the Department first raised a preliminary objection to the maintainability of the writ petition itself. According to him, the appropriate course available to the petitioner was to prefer an application seeking reference under Section 45 of Delhi Sales Tax Act, 1975. On merits, he points out that a copy of the E Form which is now sought to be tendered across the bar by the petitioner is not even annexed to the writ petition. Mr. Batra further submits that the Tribunal had examined the tenability of the contention of the petitioner and rejected it after finding the form to be defective. 13. Since, after examining the matter, we find no merit in the writ petition, we do not consider it necessary to deal with the preliminary objection raised by the respondent. At the outset we may state that the question whether E Form produced by the petitioner was satisfactory and met the requirements of Section 6(2) of the CST Act, is purely one of fact and the determination by the Appellate Tribunal of such question is against the petitioner. At the outset we may state that the question whether E Form produced by the petitioner was satisfactory and met the requirements of Section 6(2) of the CST Act, is purely one of fact and the determination by the Appellate Tribunal of such question is against the petitioner. We do not see how, in the exercise of an extraordinary jurisdiction under Article 226 of the Constitution of India, we can reexamine this question of fact particularly since we do not find anything perverse or legally unsustainable in the impugned order of the Tribunal. 14. In order to examine whether the impugned order of the Appellate Tribunal warranted interference, we perused the copy of the E-II Form handed across the bar by the Counsel for the petitioner. We noticed that Column C, which requires the details about "Name of place and State in which movement commenced" and "Name of place and State to which the goods have been consigned", is left blank. The "date" and "place" columns at the foot of the form are also left blank. On reverse of the form, details of about 10 invoices along with dates and amounts are mentioned. Although there is a date endorsement of 29 December, 2003 on the left hand top corner of the form, this is apparently the date on which the Department issued the form to the supplier and not the date on which it was given by the supplier to the petitioner. There cannot be any manner of doubt that in this E-II Form produced in support of the petitioners claim under Section 6(2) of the CST Act, the material particulars concerning the movement of goods in the course of interstate trade are missing. In the circumstances, we do not consider this to be a mere irregularity. The decision relied upon by the petitioner in Remfry & Sons (supra) is under the Income Tax Act, 1961 and is of no assistance to it. The decisions in Kirloskar Electric Co. Ltd. and P.A. George are clearly distinguishable on facts. Here the Appellate Tribunal has itself, and in our view rightly, examined the document sought to be produced for the first time and found it to be defective in material particulars. There was, therefore, no need to pointlessly remand the matter to a lower authority for performing the same exercise. Ltd. and P.A. George are clearly distinguishable on facts. Here the Appellate Tribunal has itself, and in our view rightly, examined the document sought to be produced for the first time and found it to be defective in material particulars. There was, therefore, no need to pointlessly remand the matter to a lower authority for performing the same exercise. We find absolutely no infirmity in the finding of the Appellate Tribunal, that calls for our interference under Article 226. 15. Accordingly, the writ petition is dismissed with no orders as to costs. The Application also stands disposed of. Writ Petition dismissed.