The main legal point established in the judgment is the importance of correctly interpreting and applying the provisions of the CST Act, particularly in relation to transit sales and exemptions under Section 6(2).

JUDGMENT :

Heard learned counsel for the parties.

2. The instant writ application has been preferred by the petitioner for following reliefs:-

(i) For quashing a portion of the order dated 19th May, 2016 passed in Revision Case bearing No. JR 167 of 2015 by learned commercial Taxes Tribunal, Jharkhand, Ranchi (Annexure-7) wherein revision application of the petitioner on the issue pertaining to ‘Transit Sale’ has been rejected;

(ii) To quash/set aside the order dated 19.03.2015 passed by Joint Commissioner of Commercial Taxes (Appeal), Jamshedpur Division in Appeal Case No. JU/CST-A-06/2014-15, communicated to the petitioner vide Memo No. 182 dated 19.03.2015 wherein appeal filed by the petitioner has been dismissed to the extent it relates to the issue of ‘Transit Sale’;

(iii) To quash/set aside the Assessment Order dated 15.03.2014 passed by Assistant Commissioner of Commercial Taxes Urban Circle, Jamshedpur (Respondent No.4) wherein Assessing Officer, while passing the assessment order pertaining to Financial Year 2010-11 had proceeded to levy tax under the provisions of Central Sales Tax Act, 1956, to the extent tax it had levied in respect of transaction pertaining to ‘Transit Sale’.

3. The brief facts of the case as enunciated by the pleadings is that the petitioner company is primarily engaged in providing basic utility services to the citizens of Jamshedpur and it surrounding places as a Contractor of M/s. Tata Steel Limited. The primary service provided by the Petitioner are distribution of electricity, supply of water, maintenance of sanitary and water system, maintenance of parks and garden, maintenance of geological park, educational institution and to provide basic civic amenities and maintenance of city streets of joining area. Petitioner is also executing different works contract awarded to it by various clients.

During relevant financial year (2010-2011), Petitioner was having three separate purchase orders dated 24.12.2009, 02.02.2010 and 18.03.2010 issued in its favour by M/s. Tata Steel Limited for supply and delivery of goods. During the assessment proceeding, Petitioner furnished requisite statutory forms being E-1, E-2 and Form 'C' in terms of Section 6(2) read with Section 8(4) of CST Act in proof of transaction pertaining to transit sales. Apart from the above, Petitioner also furnished following documents before the learned Assessing Officer, namely:-

(i) Copies of purchase orders for purchase of goods issued by M/s. Tata Steel Limited to the Petitioner.

(ii) Copies of Invoices of the venders from whom the Petitioner had purchased the goods in question including copies of Delivery Challans.

(iii) Road Permits being JVAT 504G.

(iv) Lorry Receipts, and

(v) Copies of Invoices raised by the Petitioner to M/s. Tata Steel Limited

However, Assessment Order was passed by Assessing Officer, wherein primarily following two transactions, tax were levied upon the Petitioner under the provisions of CST Act:-

(i) Levy of tax on transaction of inter-State sales made by Petitioner in pursuance of execution of works contract for an amount of Rs. 31,23,66,171.21/-.

This issue is not the subject matter of adjudication before this Court as the Revisional Court has allowed the Revision Petition bearing No. JR 167 of 2015 to this extent.

(ii) Rejection of claim of Petitioner of transit sales under Section 3(b) read with Section 6(2) of CST Act and consequential levy of tax thereupon for an amount of Rs. 12,45,85,385.01/-.

4. M/s Sumeet Gadodia, learned counsel for the petitioner submits that from bare perusal of the Assessment Order to the extent of issue No.2, it would transpire that Assessing Officer proceeded to reject the transactions of transit sale of the Petitioner on the following grounds.-

(i) There was a gap of one month to six months from the date of transit sale and the consequent raising of bills by the Petitioner-company to M/s. Tata Steel Limited; and

(ii) The endorsement made in the lorry receipt does not specify the date on