1. Heard Sri Rakesh Ranjan Agarwal, learned Senior Advocate, assisted by Sri Suyash Agarwal, learned counsel for the applicant and Sri B.K. Pandey, learned Standing Counsel for the respondent.
2. Revision is admitted on the following questions of law :
(i) Whether in the facts and circumstances of the case the Tribunal was justified in remanding the case to the assessing officer ?
(ii) Whether the Tribunal was right in directing to obtain fresh enquiry report in regard to all Form F as the enquiry report has been received relating to few Forms-F only?
(iii) Whether under the facts and circumstances of the case the Form F issued by the M/s Rajdhani Traders, Delhi and M/s Radhika Enterprises, Delhi are valid declaration form under Section 6A of the Central Sales Tax Act, 1956 ?
3. With the consent of learned counsel for the parties, this revision is finally heard.
4. Briefly stated the facts of the present case are that the applicant is a registered dealer under the U.P. VAT Act, 2008 ( hereinafter referred to as the "Act") as well as under the Central Sales Act, 1956 ( hereinafter referred to as the "CST Act"). The applicant is a dealer of non ferrous metal scraps and metal utensils. During the Assessment Year 2009-10, the applicant disclosed stock transfer of non ferrous metal scraps and utensils for sale on commission agency basis, against which Forms-F No.03Q873645, 04Q715866, 03Q982073 and 03Q982074 are said to have been received by the applicant from M/s Rajdhani Traders, New Delhi for a sum of Rs.4,98,43,435/-. Likewise, stock transfer of non ferrous metal scraps of Rs. 3,01,73,690/- was disclosed on commission agency basis to M/s Radhika Enterprises, New Delhi, against two Forms-F No. 03Q725091 and 03Q725092, said to have been received by the applicant. It is the case of the applicant that entire details as required under Rule 4(4) of the Central Sales Tax (U.P.) Rules, 1957 were maintained and the said provision was fully complied with. It is also the case of the applicant that these Forms were bonafidly received by him from their aforesaid two agents at Delhi and on the strength of these Forms, a claim was made under Section 6A of the CST Act that these transactions are not sale liable to tax under the CST Act. The books of account were produced by the applicant before the Assessing Authority. On enquiry from the concerned Delhi VAT Authorities, an intimation was received through the Assistant Commissioner (SIB), Commercial Tax, Unit-I, Ghaziabad vide Letter No. 431 dated 8.9.2010 accompanied with the letter of the Commercial Tax Department and IP State, New Delhi. As per report of concerned Delhi VAT Officers "Form 'F' No. 03Q873645, 04Q715866, 03Q982073 and 03Q982074 were not issued from Zone-08 CFC (Ward-84) as per record available". The case of the applicant is that these Forms-F were received by him from his agents M/s Rajdhani Traders, Delhi for Rs.4,98,43,435/-. Likewise, verification was sought of Form-F No. 03Q725091 and 03Q725092 said have been received from the agent M/s Radhika Enterprises, New Delhi for Rs.3,01,73,690/-. Report was received from the concerned, Commercial Tax Authority under the Delhi VAT Act through the Deputy Commissioner (SIB) Commercial Tax -Unit-I, Ghaziabad vide D.O. Letter No.03630, dated 13th November, 2010 that these two Forms-F have not been issued by the Delhi VAT Authorities to the aforesaid M/s Rakhika Enterprises, New Delhi rather these forms were issued to another firm M/s A.K. Technical Power Limited having TIN No. 07290176998. Thus, the total amount covered by the aforesaid six Forms-F was of Rs.8,00,17,125/-. The assessing authority, vide assessment order 31st March, 2011 levied central sales tax on these transactions treating them as central sales.
5. Aggrieved with the assessment order dated 31st March, 2011, the applicant filed First Appeal No.243/2011 before the Additional Commissioner Grade-II, ( Appeals) Commercial Tax, Mirzapur who dismissed the appeal vide order dated 21st June, 2011 observing that the aforesaid six Forms-F were not issued by the prescribed authority to M/s Rajdhani Traders, Delhi and M/s Rakhika Enterprises, New Delhi rather these forms are either stolen or forged and as such no benefit of these form can be given to the applicant.
6. Aggrieved, with the order of the first Appellate Authority, the applicant filed Second Appeal No. 649/2011 before the member Commercial Tax Tribunal, Allahabad Bench-II, Allahabad who allowed the appeal and remanded the matter to the Assessing Authority to examine the despatches and other evidences of the aforesaid alleged declared stock transfer. Aggrieved with the order of the Tribunal, the applicant has filed this revision raising aforementioned questions of law.
7. Sri Rakesh Ranjan Agarwal, learned Senior Advocate submits as under :-
(i) The cosignor and the aforesaid consignees, are registered dealers.
(ii) Form-F in question were validly issued by the Delhi VAT Department to the consignees. Even if, these forms were issued to the dealers other than the aforesaid two consignees yet it cannot be doubted that these three forms were actually issued by the Delhi VAT Authority and the forms are not forged.
(iii) The applicant has complied with all the requirements of Rule 4(4) of the CST (UP) Rules, 1957 and as such the benefit of Form-F cannot be denied.
(v) There is no allegation of collusion between the applicant and the aforesaid two consignees for procurement of the Forms-F in question and as such neither any adverse inference can be drawn against the applicant nor the benefit of Forms-F can be denied to the applicant since it was bonafidely received by the applicant from the aforesaid two agents.
(vi) It is settled law that if a departmental form for concessional rate of tax or exemption has been bonafidely received by a selling dealer from his purchasing dealer then, even if any illegality has been committed by the purchasing dealer, that shall not empower of the Assessing Authority of the selling dealer to deny the benefit of concession or exemption to the selling dealer.
(v) If any illegality was committed by the aforesaid agents of the applicant then the jurisdictional authority i.e. the Delhi VAT Authority should have initiated proceedings under Section 10A of the CST Act against those agents. But the benefit of Form-F, under Section 6A of the Act cannot be denied to the applicant.
8. In support of his submission, he relied upon the judgment of Hon'ble Supreme Court in the case of Chunni Lal Parsadilal Vs. CST, (1986)62 STC 112 (SC) and the judgment of this Court in the case of Star Paper Mills Ltd. Vs. CST, 2004 UPTC 317 (Alld, Bharat Iron Store Vs. CST, 1994 UPTC 130, Indra Steel P. Ltd. Vs. CST, 1995 UPTC 4, C.S.T. Vs. Rana Steels, 2003 UPTC 532, Khanha Vanaspati Ltd. Vs. CTT, 2002 UPTC 50, C.S.T. Vs. Misrilal Oil Mills, 1996 UPTC 68, C.S.T. Vs. Anil Metal Industries , 1999 UPTC 559, CST Vs. Gelton Industries , 2004 UPTC 770 and the judgment of Delhi High Court in the case of Milk Food Ltd. Vs. Commissioner VAT & Others, (2013) 59 VST 1 (Del).
9. He further submits that it is the settled position of law that if the selling dealer has bonafidely received certain Forms for concessional rate of tax or exemption against the sales made to his purchasing dealer and if any illegality has been committed by the purchasing dealer either in obtaining it, the selling dealer cannot be denied the benefit of such form. The authorities may initiate action against purchasing dealer but the benefit of Forms cannot not be denied to the selling dealer, unless it is found that the form submitted by the selling dealer is the result of fraud or collusion.
10. Sri B.K. Pandey, learned Standing Counsel submits that the applicant has shown stock transfer to their alleged agents, namely, M/s Rajdhani Traders, Delhi and M/s Radhika Enterprises, New Delhi. It is the case of the applicant that these Forms-F were received from the aforesaid two agents who are infact extended hands of the applicant i.e. the principal. No evidence has been submitted by the applicant at any stage of the proceeding to demonstrate that these Forms-F were obtained by the aforesaid agents from the Prescribed Authority. Thus, these forms were totally invalid forms and were nothing but a waste paper. He submits that the order of remand by the Tribunal cannot be said to be unjustified under the facts and circumstances of the case and the law laid down by this Court in the case of M/s Rajesh Trading Company, Ghaziabad Vs. Commissioner of Trade Tax, U.P. at Lucknow & Ors, 2006 NTN ( Vol-31)- 111.
11. I have carefully considered the submission of learned counsel for the parties.
12. It is undisputed that the aforesaid four Forms-F of Rs.4,98,43,435/- were submitted by the applicant for taking benefit of Section 6A of the CST Act showing these to have been received from their agent M/s Rajdhani Traders, Delhi. Likewise, the aforesaid two Forms-F of value of Rs.3,01,73,690/- were submitted to take benefit of Section 6A of the CST Act showing it to have been received from their agent M/s Radhika Enterprises, New Delhi. From the facts and circumstances and findings recorded in the assessment order, the order of the first Appellate Authority and the Tribunal, it cannot be disputed that these six Forms-F were not obtained by the aforesaid two agents M/s Rajdhani Traders, Delhi and M/s Radhika Enterprises, New Delhi from their Assessing Authority/ Prescribed Authority.
13. Section 6A(1) of the CST Act, for better appreciation and application on the facts of the present case; is reproduced in the following manner :-
"Section 6-A(1)
(i) Where any dealer claims that he is not liable to pay tax under this Act, in respect of any goods, on the ground that the movement of such goods from one State to another was occasioned by reason of transfer of such goods by him to any other place of his business or to his agent or principal, as the case may be, and not by reason of sale,
(ii) the burden of proving that the movement of those goods was so occasioned shall be on that dealer,
(iii) and for this purpose he may furnish to the assessing authority, within the prescribed time or within such further time as that authority may, for sufficient cause, permit,
(iv) a declaration, duly filled and signed by the principal officer of the other place of business, or his agent or principal, as the case may be, containing the prescribed particulars in the prescribed form obtained from the prescribed authority, along with the evidence of despatch of such goods and
(v) if the dealer fails to furnish such declaration, then, the movement of such goods shall be deemed for all purposes of this Act to have been occasioned as a result of sale."
14. Sub-section (2) of Section 6A provides that if the Assessing Authority is satisfied after making such inquiry as he may deem necessary that the particulars contained in the declaration furnished by a dealer under sub-section (1) [are true and that no inter-State sale has been effected, he may, at the time of, or at any time before, the assessment of the tax payable by the dealer under this Act, make an order to that effect and thereupon the movement of goods to which the declaration relates shall, subject to the provisions of sub-section (3)], be deemed for the purpose of this Act to have been occasioned otherwise than as a result of sale.
15. Sub-section (3) of Section 6A empowers the Assessing Authority to initiate re-assessment proceedings on the ground of discovery of new fact or revision by a higher authority on the ground that the findings of the assessing authority are contrary to law, and such reassessment or revision may be done in accordance with the provisions of general sales tax law of the State.
16. Sub-section (1) of Section 6A of the CST Act has used the words "Assessing Authority" and "Prescribed Authority". The word "Assessing Authority" has been defined in the explanation to Section 6A to mean that in relation to a dealer, the authority for the time being competent to assess the tax payable by the dealer under this Act. The word "Prescribed Authority" has been defined in Section 2(cc) of the Central Sales Tax ( Registration and Turnover) Rules , 1957 as under : -
"(cc) 'prescribed authority' means the authority empowered by the Central Government under sub-section (2) of section 9, or the authority prescribed by a State Government under clause (e) of sub-section (4) of section 13, as the case may be;"
17. Clause (e) of sub-section (4) of Section 13 of the CST Act is a rule making power which provides as under : -
"(e) the authority from whom, the conditions subject to which and fees subject to payment of which any form of certificate prescribed under clause (a) of the first proviso to sub-section (2) of section 6 or of declaration prescribed under sub-section (1) of section 6A or sub-section (4) of section 8 may be obtained, the manner in which such forms shall be kept in custody and records relating thereto maintained and the manner in which any such form may be used and any such certificate or declaration may be furnished."
18. Rule 12(5) of the CST Rules, 1957 provides that the declaration referred to in sub-section(1) of Section 6A shall be in form -F. Sub Rule( 6) of Rule 12 provides that Form-F referred to in sub-rule(5) shall be the one obtained by the transferee in the State in which goods covered by such Form are delivered. This clearly indicates that Form-F has to be obtained by the transferee from the prescribed authority in the State in which the goods covered by such forms are delivered.
19. The word 'such declaration' used in the last part of Section 6A refers to the expression 'a declaration in the prescribed form obtained from the prescribed authority' used in the earlier part of Section 6A. In the case of Mohan Lal and another Vs. Grain Chamber Ltd. Muzaffarnagar & Others, AIR 1959 (Alld) 276, this Court observed that when the word 'such' is used before a noun in a later part of a sentence, the proper construction in the English language is to hold that the same noun is being used after the word 'such' with all its characteristics which might have been indicated earlier in the same sentence. In the case of M/s Bright Brothers (P) Ltd., Bombay Vs. J.K. Sayani, AIR 1976 (Mad) 55, Madras High Court held that the word 'such' indicates some thing just before specified or spoken of, proximately and not merely previously. The word 'such' occurring in the expression such revocation or renunciation in Section 206 of the Indian Contract Act will refer only to revocation and renunciation dealt with in Section 205. In the case of Nirmaljit Singh Hoon Vs. State of W.B., AIR 1972 SC 2639, 2651, Hon'ble Supreme Court held that the words 'such court' mean every Court before which a party to a proceeding in that Court had produced or tendered in evidence document in respect of which the offence in alleged to have been committed.
20. It is also settled principles of law that every effort should be made to give effect to each and every word used by the legislature. Presumption is that the legislature inserted every part thereof for a purpose and the legislative intention is that every part of the statute should have effect. A construction which attributes redundancy to the legislature will not be accepted except for compelling reasons such as obvious drafting error. These principles are supported by the law laid down by Hon'ble Supreme Court in number of judgments including the constitution Bench judgment in the case of Nathi Devi Vs.Radha Devi Gupta JT 2005(1) SC 1 ( para 12 to 15). In view of these settled principles of law the words ' obtained from the prescribed authority' and the words 'such declaration' have to be given due meaning while understanding the provision of Section 6A of the CST Act.
21. Thus as per Scheme of Section 6A of the CST Act read with Rule 2(cc) and 12(5) of the Rules, one of the most crucial requirement to avail benefit of a Form-F is that such Form-F should be obtained by the transferee from the Prescribed Authority. This follows that it should be a validly obtained and not an invalid, illegal, forged or fabricated form. The postilion may be different, depending upon the facts and circumstances; in a case of simple transaction of purchase and sale when a selling dealer bonafidely and with due diligence received a form from his purchasing dealer for concessional rate of tax or exemption against a sale. But Section 6A is entirely a different provisions. It is by legal fiction that movement of goods from one State to another State may be deemed to have occasioned as a result of sale, if the conditions specified in sub-section (1) of Section 6A are not satisfied .
22. There is another aspect of the matter. Stock transfer of goods is made by a dealer either to his another place of business or to a place of business of his agent or principal. Thus the other place of business is not of a stranger but his own place of business or his agent/ principal's place of business. Therefore, he cannot escape his liability to tax in the circumstances that Form F has not been obtained by his branch or agent from the prescribed authority under the CST Act or the form itself is forged, bogus or fabricated. In such cases even the question of receiving it bonafidely from his own branch or agent, would not arise at all as his branch is not a separate legal entity and agent is his own extended hand. Nothing has been brought on record by the applicant to show that any effort was made by him to lead any evidence that Form-F in question were obtained from the Prescribed Authority of his Branch or agent in the other State. In case where a dealer claims benefit of Section 6A of the CST Act on the strength of Forms-F and the Assessing Authority on the basis of relevant materials and evidences on record points out to the dealer that Form-F so submitted by him is either invalid, forged, illegal or fabricated or not obtained from the Prescribed Authority by the agent or branch then onus heavily lies upon the claimant dealer to prove genuineness of such Form-F and that it was obtained from the Prescribed Authority. The applicants have completely failed to bring on record any evidence to prove that Forms 'F' in question were obtained by the agents from the prescribed authority. Therefore, Forms 'F' in question are not valid Form, and therefore, not valid declarations under section 6A of the CST Act. Under the circumstances Question No. (iii) is answered in negative, i.e. in favour of the revenue and against the assessee.
23. The view taken by me as above is also supported by the law laid down by Hon'ble Supreme Court in the case of Ashok Leyland Vs. State of T.N. and another reported in 2004 (3) SCC 1. In para 44 of the said judgement, Hon'ble Supreme Court held that declaration under Section 6 A of the Central Act would contain the prescribed particulars in the prescribed form obtained from the prescribed authority and alongwith the declaration, the dealer is required to furnish the evidence of dispatch of such goods by reason of Act 20 of 2002. If the dealer fails to furnish such declaration, by reason of legal fiction, the movement of goods would be deemed, for all purposes of the CST Act, to have been occasioned as a result of sale. The prescribed authority of the transferee State supplies the said form. The original of the said form is to be filed before the authorities of the transferor State and the duplicate thereof is to be filed before the authorities of the transferee State. Section 6A provides for exception as regard the burden of proof in the event a claim is made that transfer of goods had taken place otherwise than by way of sale. Indisputably, the burden would be on the dealer to show that the movement of goods had occasioned not by reason of any transaction involving sale of goods but by reason of transfer of such goods to any other place of his business or to his agent or principal, as the case may be. Burden of proof may be discharged by the dealer by furnishing to the assessing authority within the prescribed time a declaration duly filled and signed by the principal officer of the other place of business or his agent or principal. Such declaration shall be made in the prescribed Form F obtained from the prescribed authority. The dealer is also required to furnish the evidence of such dispatch of goods by reason of Act 20 of 2002. Failure to furnish such declaration, by reason of legal fiction, shall render such movement of goods would be deemed for all purposes of the CST Act. When the dealer furnishes the original Form F to its assessing authority, an enquiry is required to be held. Such enquiry is held by the assessing authority himself who may pass an order on such declaration before the assessment or along with the assessment. Once an order in terms of Sub-Section 2 of Section 6A of Central Act is passed, the transactions involved therein would go out of the purview of the Central Act.
24. In the case of Ashok Leyland Ltd. (Supra), Hon'ble Supreme Court held as under:
" 44. The liability to tax on inter-State sale as contained in Section 6 is expressly made subject to the other provisions contained in the Act. Sub-section (2) of Section 9, on the other hand, which is a procedural provision starts with the words "subject to the other provisions of this Act and the rules made thereunder ". Section 6-A provides for exception as regards the burden of proof in the event a claim is made that transfer of goods had taken place otherwise than by way of sale. Indisputably, the burden would be on the dealer to show that the movement of goods had occasioned not by reason of any transaction involving sale of goods but by reason of transfer of such goods to any other place of his business or to his agent or principal, as the case may be. For the purpose of discharge of such burden of proof, the dealer is required to furnish to the assessing authority within the prescribed time a declaration duly filled and signed by the principal officer of the other place of business or his agent or principal. Such declaration would contain the prescribed particulars in the prescribed form obtained from the prescribed authority. Along with such declaration, the dealer is required to furnish the evidence of such dispatch of goods by reason of Act 20 of 2002. In the event it fails to furnish such declaration, by reason of legal fiction, such movement of goods would be deemed for all purposes of the said Act to have occasioned as a result of sale. Such declaration, indisputably, is to be filed in Form F. The said form is to be filled in triplicate. The prescribed authority of the transferee State supplies the said form. The original of the said form is to be filed with the transferor State and the duplicate thereof is to be filed before the authorities of the transferee State whereas the counterfoil is to be preserved by the person where the agent or principal of the place of business of the company is situated.
72. A statute, as is well-known, must be interpreted having regard to the text and context thereof. Mischief Rule may also be applied in a given case.
73. While construing a statute, the object of the Act must be taken into consideration. (See Killick Nixon Ltd. v. Deputy Commissioner of Income Tax.
74. Section 6A of the Act although provides for a burden of proof, the same has to be read in the context of Section 6 of the said Act. Section 6 provides for liability to pay tax on inter-State sales. Any transaction which does not fall within the definition of 'sale' would not be exigible to tax, the burden whereof would evidently be on the assessee. We have noticed hereinbefore that whereas prior to the amendment in Sub-section (1) of Section 6A the dealer had ah option of filing a declaration in Form-F; after such amendment, he does not have such option, insofar as in terms of the amended provision, if the dealer fails and/or neglects to file such a declaration, the transaction would be deemed to be ah inter-State sale. It is to be noticed that for the aforementioned purpose also, the Parliament advisedly used the expression 'deemed'. If the expression 'deemed' is interpreted differently, an incongruity would ensue.
75. In absence of any indication that the Parliament while enacting Sub- section (2) of Section 6A did not intend to make the deeming provisions to be a conclusive fact as regard occasion of the transaction having taken place otherwise than as a result of sale, it would have dealt with the matter differently.
76. Section 6A(2) of the Act uses the following expressions which are important : (1) 'thereupon'; (2) 'for the purpose of this Act'; (3) 'the movement of goods to which the declaration related shall be deemed for the purpose of this Act to have been occasioned otherwise than as a result of sale'.
77. Each of them must be given its proper meaning.
78. A statute for the purpose of its interpretation must be read in its entirety. It is to be given a purposive construction. Applying Heydon's rule, it must be held that the amendment was necessitated not only to make the dealer to file such a declaration imperatively but also to see that such movement of goods becomes inter-State sale by raising a legal fiction, as 'having been occasioned in course of a inter-State sale'. In other words, if such a declaration is filed and on an inquiry made pursuant to or in furtherance of the particulars furnished are found to be correct by the assessing authority, the result thereof which is evidenced by the expression 'thereupon' shall in view of the legal fiction created would be a transaction otherwise than as a result of an inter-State sale. Furthermore, once such a legal fiction is drawn, the same would continue to have its effect not only while making an order of assessment in terms of the State Act but also for the purpose of invoking the power of reopening of assessment contained in Section 9(2) of the Central Act as well as Section 16 of the State Act.
100. In terms of Clause (3) of Article 269, inter-state sale is contrasted from local sale.
101. An order passed by the statutory authority who has jurisdiction therefore, the same would amount to a part of substantive and not procedural law. In addition to this there is no provision for appeal. Thus, it is only in the limited cases of fraud, mis-representation etc. that reassessment can be directed and not if there had been a mere error of judgment.
102. If it is not an inter-State sale provided through a legal fiction, then it amounts to transfer of stock and this is a finding which has been arrived at by a statutory authority where for there does not exist any provision for appeal. Therefore, it cannot be reopened on the premise that there was a mere error of judgment or change in opinion.
103. Once it is held that such determination of an issue having regard to legal fiction created in terms of Sub-section (2) of Section 6A is conclusive, it must a fortiorari follow that the same is binding.
104. The particulars required to be furnished in Form F clearly manifest that the proof required is as to whether the goods were factually transferred to the assessee himself or his branch office or his agent and not to any third party. Any other enquiry is beyond the realm of the assessing authority.
110. In Sahney Steel (supra) whereupon reliance has placed by the assessing authority, a contention was raised that the registered office and the branch office were separately registered as dealers under the sales tax law and transaction effected by the branch office should not be identified with transactions effected by the registered office, Pathak, J., as the learned Chief Justice-then was, observed :
"..We are unable to agree. Even if, as in the present case, the buyer places an order with the branch office and the branch office communicates the terms and specifications of the orders to the registered office and the branch office itself is concerned with the sales dispatching, billing and receiving of the sale price, the conclusion must be that the order placed by the buyer is an order placed with the Company and for the purpose of fulfilling that order the manufactured goods commence their journey from the registered office within the State of Andhra Pradesh to the branch office outside the State for delivery of the goods to the buyer..."
111. The Court in the facts of that case held that the movement from the head office to the branch office was for the purpose of delivery to the branch office, thereafter to the buyer through the branch office. The branch office merely acted as a conduit through which the goods passed on their way to the buyer. It is, however, relevant to note that the Court noticed :
"...It would have been a different matter if the particular goods had been dispatched by the registered office at Hyderabad to the branch office outside the State for sale in the open market and without reference to any order placed by the buyer. In such a case if the goods are purchased from the branch office, it is not a sale under which the goods commenced their movement from Hyderabad. It is a sale where the goods moved merely from the branch office to the buyer..."
112. The purpose of verification of the declaration made in Form F, therefore, is as to whether the branch office acted merely as a conduit or the transaction took place independent to the agreement to sell entered into by and between the buyer and the registered office or the office of the company situated outside the State. The said decision therefore, does not run counter to our reading of the said provision. Furthermore, the question which has been, raised before us had not been raised therein.
113. We, therefore, are of the opinion that the observations made by this Court in Ashok leyland (supra) to the effect that an order passed under Sub-Section (2) of Section 6A can be subject matter of reopening of a proceeding under Section 16 of the State Act was not correct.
114. However, we may hasten to add that the same would not mean that even wherein such an order has been obtained by commission of fraud, collusion, misrepresentation or suppression of material facts or giving or furnishing false particulars, the order being vitiated in law would not come within the purview of the aforementioned principle.
115. An order of assessment is albeit passed under the State Act. But once it is held that the concerned State Act as also the Central Act is not applicable, as a consequence whereof sales tax would be payable under another State Act, it is doubtful as to whether the power to reopen the proceedings under the State Act or the Central Act would be attracted. There does not exist any power in the statute to rectify a mistake. In that view of the matter, mere change in the opinion of the assessing authority or to have a re-look at the matter would not confer any jurisdiction upon him to get the proceedings reopened. Discovery of a new material although may be a ground but that itself may not be a ground for reopening the proceedings unless and until it is found that by reason of such discovery, a jurisdictional error has been committed. In other words, when an order passed in terms of Sub-Section (2) of Section 6A is found to be illegal or void ab initio or otherwise voidable, the assessing authority derives jurisdiction to direct reopening of the proceedings and not otherwise.
116. In Shrisht Dhawan (supra) this Court has held:
"20. Fraud and collusion vitiate even the most solemn proceedings in any civilised system of jurisprudence. It is a concept descriptive of human conduct. Michael Levi likes a fraudster to Milton's sorcerer, Compus who exulted in his ability to, 'wing me into the easy-hearted man and trap him into snares'. It has been defined as an act of trickery or deceit. In Webster's Third New International Dictionary fraud in equity has been defined as an act or omission to act or concealment by which one person obtains an advantage against conscience over another or which equity or public policy forbids as being prejudicial to another. In Black's Legal Dictionary, fraud is defined as an intentional perversion of truth for the purpose of inducing another in reliance upon it to part with some valuable thing belonging to him or surrender a legal right; a false representation of a matter of fact whether by words of by conduct, by false or misleading allegations, or by concealment of that which should have been disclosed, which deceives and is intended to deceive another so that he shall act upon it to his legal injury. In Concise Oxford Dictionary, it has been defined as criminal deception, use of false representation to gain unjust advantage; dishonest artifice or trick. According to Halsbury's Laws of England, a representation is deemed to have been false, and therefore a misrepresentation, if it was at the material date false in substance and in fact. Section 17 of the Contract Act defines fraud as act committed by a party to a contract with intent to deceive another. From dictionary meaning or even otherwise fraud arises out of deliberate active role of representator about a fact which he knows to be untrue yet he succeeds in misleading the represented by making him believe it to be true. The representation to become fraudulent must be of the fact with knowledge that it was false. In a leading English Case (Derry v. Peek (1886-90) All ER 1) what constitutes fraud was described thus: (ARR ER p. 22 B-C):
Fraud is proved when it is shown that a false representation has been made (i) knowingly, or (ii) without belief in its truth, or (iii) recklessly, careless whether it be true or false."
117. This aspect of the matter has been considered recently by this Court in Roshan Deen v. Preeti Lal : (2002)ILLJ465SC , Smt. Anita v. R. Rambilas : AIR2003AP32 , Ram Preeti Yadav v. U.P. Board of High School and Intermediate Education and Ors. : AIR2003SC4268 and Ram Chandra Singh v. Savitri Devi and Ors. : (2003)8SCC319
25. Hon'ble Supreme Court in the case of ITC Ltd. Vs. Commissioner of Central Excise, New Delhi and another reported in 2004 (7) SCC 591 held as under:
"47. It has been correctly submitted on behalf of the appellant that declarations required under divers statutes have different characteristics and consequences depending upon the nature of the declaration. A declaration may be (1) an assurance of an existing state of affairs or (2) an assurance of a future course of conduct by the declarant himself or (3) a statement of required conduct by a third party. In the first two kinds of declarations the onus is one the declarant to make good the declaration. In other words the truth of the declaration may be verified. But when all that is stated in the declaration is a requirement to be fulfilled by another, what is to be enquired into is compliance with the requirement and not the correctness of the declaration itself. The Revenue has failed to keep in mind the distinction between different kinds of declarations. Most of the cases cited by the Revenue in this context deal with the first and second kinds of declaration where the declaration asserts a present of future state of affairs and seeks to certify as true, facts which may be questioned by the authority which is called upon to act on such certification whereas declarations under the notification fall into the third category.
48. Declarations to be furnished in Form 'C' by registered purchasing dealers under Section 8(1) of the Central Sales Tax Act, 1956 which certify that the purchasing dealer is a registered dealer in respect of commodities mentioned in the declaration, are illustrative of the first kind of declaration. Thus it was held in the State of Madras v. M/s. Radio and Electricals Ltd., [1966] Suppl. SCR 198 that the Sales Tax Authority was competent to scrutinize the certificate to find out whether it is genuine. He could also make an enquiry about the contents of the certificate of registration to satisfy himself whether the goods purchased were covered by the certificate or not. But once he was satisfied that the certificate is genuine and that it covers the goods being purchased, the Sales Tax Officer was incompetent to hold an enquiry whether the goods so specified could be used for any of the purposes mentioned in form 'C' or whether the goods purchasing were in fact not used for the purposes declared in the certificate. M/s. Chuni Lal Parshadi Lal v. Commissioner of Sales Tax, [1986] SCC 501 followed the decision in State of Madras v. Radio and Electricals Ltd. (supra) and held that for the purpose of the U.P. Sales Tax Act, 1948, the Sales Tax Authorities could only look into the question whether the certificate was forged or fabricated and the Sales Tax Officer could not hold an enquiry whether the purchasing dealer, notwithstanding the declaration, was likely to use the goods purchased for purposes other than that mentioned in the Form 'C. If the certificate was valid and covered the goods purchased, the Court held that it raised an irrebuttable presumption that the goods would be used for the purposes mentioned, since the purpose of the rule was to make the object of the provision of the act workable which was realization of tax at one single point, i.e. at the point of sale to the consumer Similarly, declarations of value for the purposes of import or export duty under the Customers Act, 1902 fall within the first category. For example Jacksons Thevara v. Collector of Customs and Central Excise, [1991] 2 SCC 62 was a case where the declaration on the basis of which concessional rate of import duty was availed of by the importer, was found to be false. The importer had declared that the goods were to be used for substantial expansion of his unit. In fact they were to be used for setting up a new unit of a company. In Toolsidass Jewraj v. Additional Collector of Customs, [1991] 2 SCC 443 the full export value had not been stated in the shipping bills and G.R.I. forms. This was admitted but was sought to be explained by the importer. The explanation was not accepted by the Customs Authorities because to do so would have contravened the Foreign Exchange Regulation Act. In both these cases this Court upheld the action of the Customs Authority in taking action against the person by going into the truth of the declaration."
26. In view of above discussions, I am of the view that if a dealer claims a transaction to be covered by Section 6 A of the CST Act, then he has to satisfy the conditions mentioned in the said provision and has also to submit a declaration in Form F, which should be genuine one. An in-genuine Form F may not entitle the dealer to avail the benefit under Section 6 A of the Act in respect of a particular transaction, for which, in-genuine Form F has been filed.
27. The tribunal has found that enquiry into the facts of the case can be better made by the assessing authority and, as such, it remanded the matter. If according to the petitioner, the transactions are genuine and it fulfils all the conditions prescribed under Section 6 A of the Act, then there is no reason for him to oppose the order of remand. The remand has been made for the purpose of enquiry. It does not cause any prejudice to the applicant.. In the circumstances, I do not find any infirmity in the impugned order of the Tribunal to remand the matter to the assessing authority. Question of law No. (i) and (ii) are, therefore, answered in affirmative i.e. in favour of the Revenue and against the assessee.
28. Learned counsel for the applicant has relied upon on several decisions of this Court and also judgement of Hon'ble Supreme Court in the case of Chunni Lal Parshadi Lal (Supra). These judgments relate to Form C bona fidely received by the selling dealer. As already clarified simple transactions of interstate sale against Form C between two dealers are different than the transactions of stock transfer.
29. A case involving claim under Section 6 A of the CST Act stands on different footing than the case of interstate sale against Form- C, in which case, it may be possible that selling dealer has bona fidely effected interstate sale and bona fidely received Form-C to avail concessional rate of tax. So far as judgement of this Court in Kanha Vanaspati Ltd. (Supra) is concerned, it is suffice to say that the said judgement was rendered by this Court on 19th December, 2001 while the law on the issue has been subsequently settled by Hon'ble Supreme Court in the case of Ashok Leyland Ltd (Supra), which is binding on this Court.
30. The next judgment relied upon by the learned counsel for the applicant is in the case of Misri Lal Oil Mills Ltd. (Supra), in which, the controversy involved was entirely different. In that case, the genuineness of Form F was not in doubt. The transactions were accepted by the agent initially. It was not in dispute that Form F was obtained by the agent from the prescribed authority and the said declaration in Form F was given to the transferrer dealer. Initially, the transferee accepted the transactions, but subsequently, he denied the transactions. Thus the facts of the present case are entirely different and therefore, the judgment of this Court in the case of Misri Lal OIl Mills (Supra) has no application on the facts of the present case.
31. In view of above discussions, I do not find any infirmity in the impugned order of Tribunal. The question of law no. (i) and (ii) are answered in affirmative i.e. in favour of the revenue against the assesse. Question No. 3 is answered in negative i.e. in favour of the Revenue and against the assessee.
32. In result, revision fails and is hereby dismissed.
Order Date :06.9.2014 Mukesh (Surya Prakash Kesarwani,J.) Court No. - 4 Case :- SALES/TRADE TAX REVISION DEFECTIVE No. - 70 of 2014 Applicant :- M/S Kunj Bihari Lal Radheyshyam Opposite Party :- The Commissioner, Commercial Tax, U.P., Lucknow Counsel for Applicant :- Suyash Agrawal,Rakesh Ranjan Agarwal Counsel for Opposite Party :- C.S.C.
Hon'ble Surya Prakash Kesarwani,J.
Ref: Civil Misc. Delay Condonation Application.
1. Heard Sri Rakesh Ranjan Agarwal, learned Senior Advocate, assisted by Sri Suyash Agarwal, learned counsel for the applicant and Sri B.K. Pandey, learned Standing Counsel for the respondent.
2. This revision has been filed beyond 30 days of limitation along with delay condoanation application and affidavit explaining the delay.
3. Cause show is sufficient.
4. Delay Condonation Application is allowed.
Order Date :06.9.2014 Mukesh (Surya Prakash Kesarwani,J.)