IMPORTANT POINTS
Section 6A of the Central Sales Tax Act provides that where any dealer claims he is not liable to pay tax, on the ground that the movement of 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, the burden of proving such fact shall be on the dealer and for that purpose, he may furnish such documents, including a declaration in the prescribed form along with the evidence of despatch of such goods. Section 6A was amended by Finance Act, 2002, by providing that, failure of a dealer to furnish such declaration shall be deemed for all purposes of the Act to have been occasioned as a result of sale. Rule 12(5) of the Central Sales Tax (Registration and Turnover) Rules, 1957, prescribes that the declaration referred to in Section 6A shall be in Form F.

ORDER :

T.R. RAVI, J.

The assessee is a Company involved in the processing of marine and other edible commodities, principally for export. The assessee has a factory at Ezhupunna in Kerala and another factory at Bangalore in Karnataka. According to the assessee, processing happens in both the factories and depending on the requirement, stock transfers are made between the two factories and at times, fully processed items are re-transported to Cochin and then exported. Similarly, it is stated that they also carry out export from Bangalore.

2. The assessee has approached this Court in two revision petitions; one as against the assessment under the Kerala Value Added Tax Act, 2003 and the other under the Central Sales Tax Act, 1956. Both the revision petitions relate to the assessment year 2007-08. O.T.Rev.No.152 of 2016 is filed against the order dated 30.3.2016 in TA(VAT) No.325 of 2014 and O.T.Rev.No.153 of 2016 against the order dated 30.3.2016 in TA(VAT) No.326 of 2014. Since the issues involved in the two revisions are interrelated and arise from the same assessment year, we deem it appropriate to hear and dispose of the two revision petitions together.

3. The facts are not in dispute. The assessee has purchased goods from unregistered dealers. They have been processed partially in the factory at Ezhupunna and transferred to Bangalore for further processing. The goods were transferred to Bangalore without a declaration in Form F. According to the petitioner, the goods were moved from their factory in Kerala to their factory at Bangalore and there is no sale involved in such movement of goods. The petitioner further contends that the movement of goods were in the course of export and the assessee is entitled to exemption, even without a declaration in Form F for reason of the movement of goods having been occasioned under purchase orders of export, as was being granted in the previous years.

4. The Assessing Officer proceeded to assess the petitioner under the KVAT Act, by adding the value of purchases carried out relating to stock transfer of processed goods to the tune of Rs.2,11,56,840/-, to the total turnover conceded, for bringing the same to tax under Section 6(2) of the Act. In appeal against the assessment, the Deputy Commissioner (Appeals), modified the assessment by reducing the addition to Rs.1,95,13,800/-, since a portion of the stock transfer had been carried out supported with Form F declarations. The stock transfers which were not supported by Form F declarations were alone taken into account for arriving at the taxable turnover under Section 6(2). The assessee challenged the appellate order before the Appellate Tribunal. The Appellate Tribunal rejected the appeal insofar as the contention regarding the exemption under Section 6(2) of the Act was concerned. O.T.Rev.No.152 of 2016 is filed challenging the above order of the Appellate Tribunal in the regular VAT assessment.

5. The Assessing Officer had also proceeded against the petitioner under the CST Act. The Assessing Officer proceeded to tax the amounts representing the stock transfers which were not supported by Form F declarations; as inter-state sales. Appeal filed against the assessment order was rejected by the Appellate Authority. The assessee challenged the appellate order before the Appellate Tribunal. The Appellate Tribunal dismissed the appeal. The assessee has filed O.T.Rev.No.153 of 2016, challenging the above order of the Appellate Tribunal. The orders of the Appellate Tribunal are produced as Annexure X in the respective revision petitions.

6. Heard Sri Harisankar V. Menon on behalf of the petitioner and the Senior Government Pleader Sri. Shamsudheen on behalf of the revenue.

7. The main contention of the counsel for the petitioner is that the proposal to tax the purchase relating to stock transfer was without any authority since the said transfer was in the course of export, which is exempted from taxation under Section 5(3) of the CST Act and Articl