SRUTHI AGENCIES Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) THIS tax revision case is at the instance of the dealer, aggrieved by the order passed by the Sales Tax Appellate Tribunal in T. A. No. 776 of 1995, dated September 30, 1999 confirming the order passed by the Deputy Commissioner (CT), Secunderabad Division, Secunderabad, dated October 26, 1995, revising the order of assessment passed by the Commercial Tax Officer.

(2.) THE petitioner is a firm, which was carrying on the business as a dealer in Symphony brand of air-coolers. It was assessed to tax for the year 1993-94 under the Andhra Pradesh General Sales Tax Act, 1957 (hereinafter referred to "the Act" or "the APGST Act") by the Commercial Tax Officer, Vidyanagar Circle, Hyderabad and by its order the assessing authority exempted Rs. 1,43,05,094, the entire turnover shown by the dealer as second sales in the State. The said assessment order is dated July 8, 1994. However, in the meanwhile, the Commercial Tax Officer (Int.) No. III, Enforcement Wing, Hyderabad, under the administrative control of the Commissioner of Commercial Taxes, inspected the business premises of M/s. Darshak Enterprises, S. D. Road, Secunderabad, which is the sole distributor of Symphony air-coolers in Andhra Pradesh from whom the petitioner/dealer purchased the air-coolers. The said inspection revealed that the selling dealers, namely the M/s. Darshak Enterprises have purchased the air-coolers in dispute in the course of inter-State transaction from M/s. Sanskrut Comfort Systems Limited, Ahmedabad and that the sale was effected in favour of M/s. Darshak Enterprises by transfer of documents of title during the course of movement of goods from Ahmedabad, Gujarat State to Andhra Pradesh and before they were taken delivery in Andhra Pradesh. It is also noticed that subsequently M/s. Darshak Enterprises also sold the said air-coolers in dispute during the transit of the goods before taking delivery from the transporters at Secunderabad by transferring the documents of title, like Lorry Receipts (LRs), in favour of the petitioner/dealer-M/s. Sruthi Agencies, which also happened to be an inter-State sale, which was effected as a transit sale. Therefore, it was realised that the sales effected by the petitioner/dealer in dispute happened to be the first sale in the State coming under the Act and therefore, the entire turnover declared by the petitioner/dealer was not entitled for exemption and was liable to be taxed. Therefore, the Deputy Commissioner (CT) initiated revisional proceedings under section 20 (2) of the Act and after giving opportunity to the petitioner/dealer, assessed the entire sales turnover to tax under the provisions of the Act. Aggrieved by the said order, the petitioner/dealer filed appeal before the Sales Tax Appellate Tribunal. Before the Tribunal also the assessee reiterated the contentions that are advanced before the Deputy Commissioner (CT ). However, the Tribunal after considering the contentions elaborately confirmed the order of the Deputy Commissioner observing that though the dealer was in the custody of the documents, it did not produce them before the authorities and therefore, an adverse inference could be drawn against the dealer and accordingly confirmed the view of the Deputy Commissioner that the sales effected by the dealer are the first sales in the State and are liable to tax under the provisions of the Act. Hence, the present tax revision case.

(3.) THE learned counsel relied upon the following decisions in support of his contention : Tata Engineering and Locomotive Co. Ltd. v. Assistant Commissioner of Commercial Taxes, Jamshedpur [1970] 26 STC 354 (SC), Arjan Dass Gupta and Bros. v. Commissioner of Sales Tax, Delhi Administration, Vikash Bhawan, New Delhi [1980] 45 STC 52 (Delhi), State of A. P. v. Thungabhadra Industries Ltd. [1986] 62 STC 71 (AP), State of Tamil Nadu v. N. Rama Bros. (Electricals) [1993] 89 STC 481 (Mad.) and Bankatlal Satyanarayana Parikh and Co. v. Commissioner of Commercial Taxes [2001] 122 STC 236 (AP ).