G.D. PHARMACEUTICALS PVT. LTD. Vs. ASSISTANT COMMISSIONER OF COMMERCIAL TAXES, CORPORATE DIVISION AND OTHERS

JUDGEMENT

(1.)

(2.) THE petitioner, M/s. G.D. Pharmaceuticals Private Ltd., an incorporated company within the meaning of the Companies Act, 1956, having its registered office at "Asha Mahal", 94, Nalini Ranjan Avenue, Kolkata 700 053, is a manufacturer of miscellaneous consumer goods. In response to an invitation for a quotation to purchase a cartoner machine, M/s. Wimco Limited, Mumbai, offered a quotation vide No. E/AA/PAC/94 dated September 26, 1994. The petitioner accepted the quotation and M/s. Wimco Limited sold the machine to the petitioner under invoice No. 1 dated April 29, 1995, challan No. 30 dated April 29, 1995. The machine was despatched by M/s. Buddha Roadways Private Limited under consignment note No. 19824 dated May 4, 1995. The machine was installed at the factory of the petitioner, but in the month of June, 1995, some latent defect in the machine surfaced. Attempts were made to rectify the defects in the machine and ultimately the petitioner asked M/s. Wimco Limited to take back the cartoner machine on February 14, 1997 and to refund the price paid for it. By a letter dated April 7, 1997, Wimco Limited agreed to take back the cartoner machine and to supply a tube filling machine by way of replacement/exchange/barter for the cartoner machine on payment, by either party, of the difference of price of the two machines. The petitioner agreed for the same. Accordingly, the cartoner machine was removed from the factory of the petitioner under Central Excise Invoice No. 120 dated July 8, 1997, challan Nos. 480 and 481 dated July 8, 1997. The machine was despatched under consignment note No. 005450 dated July 8, 1997 of M/s. Buddha Roadways Private Ltd. In the meantime, M/s. Wimco Limited raised pro forma invoice No. PI/49/97 -98, dated October 28, 1997, for the difference amount of Rs. 65,299. The petitioner paid the amount and advised M/s. Wimco Limited to despatch the tube filling machine to Ghaziabad factory of the petitioner. The said machine was despatched to Ghaziabad factory under excise invoice No. 34 dated November 13, 1997. While making assessment for the 4 quarter ending on March 31, 1998, the assessing officer of the petitioner, the Assistant Commissioner of Commercial Taxes, Corporate Division (in short, "A.C.C.T., C.D.O. added back of Rs. 2,54,166 in the gross turnover as consideration for sale of the cartoner machine since the said amount was shown as "other income" in the profit and loss account of the petitioner. The petitioner filed appeal before the Deputy Commissioner of Commercial Taxes, Corporate Divisions, (in short, "the D.C.C.T., C.D.") on many grounds including the addition of Rs. 2,54,166 to the gross turnover. The appellate authority set aside the assessment order, but observed that the alleged sale value of the machine amounting to Rs. 10,56,000 (excluding sales tax) should be added with the gross turnover as inter - State sales covered under section 3 of the Central Sales Tax Act, 1956. The petitioner, thereafter, filed revision applications before the West Bengal Commercial Taxes Appellate and Revisional Board who by an order dated November 5, 2008 confirmed the observations of the authorities below for addition of Rs. 10,56,000 in the gross turnover. In the meantime, the assessing authority re -assessed the petitioner and also added back the disputed amount to the gross turnover. Being aggrieved the petitioner has filed this revision application before this Tribunal under section 8 of the West Bengal Taxation Tribunal Act, 1987. Mr. J.A. Khan, learned advocate of the petitioner, has submitted that the procurement of the tube filling machine in replacement/exchange of the cartoner machine and the payment of difference of price does not mean that the cartoner machine was sold by the petitioner. Learned advocate has assailed the assessment, appellate and revisional orders on the following grounds:

(3.) MR . B. Majumdar, learned State Representative, has relied on the assessment, appellate and revisional orders. Mr. Majumdar has also filed a written note prepared and signed by one Mr. Sushil Kumar Mondal, A. C. C. T., C. D. It is argued that the petitioner sold one cartoner machine for Rs. 10,56,000 (excluding C. S. T.) under invoice No. 120 dated July 8, 1997 and the said transaction is an inter -State sale within the meaning of section 3 of the Central Sales Tax Act, 1956. Learned State Representative has prayed for dismissal of the petition filed by the petitioner.