The court ruled that non-furnishing of 'C' Forms by a purchaser due to financial distress does not absolve entitlement to tax exemptions under Section 6(2) of the Central Sales Tax Act, 1956.

JUDGMENT :

Soumitra Saikia, J.

The writ petitioner before this Court is a partnership firm registered under the Partnership Act, 1932 and having its Office at 76 MS Road, Athgaon, Guwahati-781001, Assam. The petitioner is a dealer engaged in sale and supply of acids and chemicals. All the partners of the petitioner firm are citizens of India and as such they are entitled to all the rights and privileges guaranteed under the Constitution of India and the laws framed thereunder from time to time. The petitioner firm at the relevant year was duly registered under the CENTRAL SALES TAX ACT , 1956 (hereinafter referred to as “the Act of 1956”) and is represented before this Court by one the partners.

2. For the period 2013-14, the petitioner firm made supplies of caustic soda to Hindustan Paper Corporation Ltd. namely the respondent No. 4 by way of e-way transactions and raised bills on the respondent No.4/ Company in respect of which the said company was required to issue declaration Forms “C” under the provisions of the Act of 1956.

3. It is submitted that the petitioner received an order from the Hindustan Paper Corporation Limited for supply of caustic soda. The Petitioner purchased the said item from a registered dealer outside the State of Assam and when the goods were in course of movement in inter-state trade and commerce by transfer of documents of title to the goods, supplied the same to the Hindustan Paper Corporation Limited. Such supply is a subsequent sale in course of inter-state trade and commerce. As per Section 16(2) of the CENTRAL SALES TAX ACT , 1956, subsequent sale made in course of interstate trade and commerce is exempted from the payment of Central Sales Tax on the dealer furnishing a declaration Form - ‘E-1’ from the dealer making the first sale and a declaration in Form — ‘C’ from the recipient of the goods i.e. ultimate purchaser. Thereby the Petitioner was required to produce Form — ‘E-1’ from dealer outside the State of Assam from whom the Petitioner purchased the caustic soda in course of interstate trade and commerce and a declaration Form —‘C’ from the Hindustan Paper Corporation Limited and on production of the ‘E-1’ Form and ‘C’ Form, the Petitioner was not liable to make payment of the Central Sales Tax in respect of the supply of caustic soda to the Hindustan Paper Corporation of India.

4. It is submitted that the Petitioner raised the bills on account of supply of caustic soda by making a subsequent sale for transfer of document title of goods during the movement of the said goods during inter-state trade and commerce and procured Form — ‘E-1’ from the first selling dealer and clearly mentioned in the invoices issued to the Hindustan Paper Corporation Limited that the sale remain even sales transactions and the name of the first supplier of the goods was also mentioned. In the said invoices it was also clearly mentioned that the Form ‘C’ was to be received from the Hindustan Paper Corporation Limited.

5. It is submitted that during the year 2013-14, the Petitioner made E-1 purchases to the tune of Rs. 5,85,96,987/- (including tax) and made E-1 sales to the tune of Rs. 7,53,13,785/- to the Hindustan Paper Corporation Limited. The Hindustan Paper Corporation submitted its ‘C’