COMMISSIONER OF SALES TAX Vs. PURE BEVERAGES LTD

JUDGEMENT

(1.) THE Gujarat Sales Tax Tribunal has referred the following question of law under section 69 of the Gujarat Sales Tax Act, 1969 ("the State Act") for the opinion of this Court, at the instance of the applicant-State of Gujarat :

(2.) THE respondent-assessee is a limited company engaged in manufacture of cold drinks. For the period from January 1, 1977 to December 31, 1977, the respondent-assessee was provisionally assessed by the Sales Tax Officer (3), Ahmedabad District, Division 1, Ahmedabad, for the relevant period. Since the dues as assessed exceeded Rs. 25,000, the respondent-assessee objected to the provisional assessment and the Assistant Commissioner of Sales Tax (Appeals-5), Range 3/9 framed the assessment under section 41 (3) read with section 46a of the State Act. The case of the assessee was that it had made inter-State sales to the tune of Rs. 8,58,343, but the said claim was not accepted and it was disallowed treating the said sales as local sales.

(3.) ACCORDING to Mr. Bhatt, the only contract between the parties was as incorporated in the terms and conditions printed on the reverse side of the invoice raised by the assessee. That as per the said terms and conditions, it was apparent that the contract was completed ex-factory; the delivery of goods was given, and thereafter, there was no risk of the seller. In the circumstances, according to the terms, neither the indent memo issued by the purchaser nor the advance payment made by the purchaser would go to prove that, in fact, the goods had moved from the State of Gujarat to the State of Rajasthan. That as the contract was completed ex-factory, it would amount to a local sale and the terms of the invoice went to show that any likely dispute between the purchaser and the seller was required to be resolved within the jurisdiction of Ahmedabad courts only. Referring to the submission on behalf of the assessee before the Tribunal regarding declaration before excise authorities, Mr. Bhatt submitted that the same was a voluntary act and even if the said documents, namely, the form submitted to the excise authorities, the gate pass issued by the excise authorities carried the details regarding the purchaser, i. e. , the name and the out of State address, etc. , it would not conclude the issue in favour of the assessee. Thus, according to Mr. Bhatt, the Tribunal had committed an error of law in reading the requirement of provisions of section 3 (a) of the Central Act, and once it was shown that the assessee had failed to establish inter-State movement of goods, nothing more was required to be done so far as the department was concerned and the transaction in question was liable to be treated as a local sale.