LexSTATE OF ORISSA AND ANR. versus M/S. K.B. SAHA AND SONS INDUSTRIES PVT. LTD. & ORS. ETC.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A
STATE OF ORISSA AND ANR.
v.
MIS. K.B. SAHA AND SONS INDUSTRIES PVT. LTD. & ORS. ETC.
APRIL 27, 2007
B
[DR.ARIJITPASAYAT ANDLOKESHWARSINGHPANTA,JJ.]
Sales Tax:
Central Sales Tax, Act, 1956-s. 3(a)-Orissa Sales Tax Act, 1947-
C Sales tax-Levy of-Transaction of sale and purchase of kendu leaves between
purchaser and Government of Orissa Undertaking-Purchaser lifting the
kendu leaves from such depots under transport permit and transporting it to
their place of business in State of West Bengal-Exigibility to sales tax-
Held: Sale/purchase occasioned movement of Kendu leaves from State of
D Orissa to State of West Bental and as such transaction taking place in course
of inter-state trade-Thus, exigible to sales tax under Central Act and not
State Act-Orissa Kendu Leaves (Control of Trade Act, 1961-S. 3(2)(b)-
Orissa Kendu Leaves (Control of Trade) Rule, 1962.
Respondents are engaged in the business of tobacco and kendu leaves.
E They prepare bidis at factories in State of West Bengal Their registered office
is outside Orissa. Trade in Kendu leaves in Orissa is a State monopoly and
thus, is being transacted by Corporation-Government of Orissa. Undertaking
which sells processed and Phal kendu leaves by way of tender and auction
every year. Corporation invited sealed tenders for sale of processed and Phal
kendu leaves from purchasers duly registered with it. Writ petitioners being
F registered purchasers with the Corporation submitted tenders which were
duly accepted. They entered into agreements with the Corporation. There was
sale of Kendu leaves and payment of the sale value. Corporation issued lifting
orders to its respective Divisional Manager permitting the purchasers to lift
the goods. Forest Officer issued trans po rt permit on the basis of which the
G writ petitioners transported the kendu leaves to their places of busineS's in
the State of West Bengal. Sales tax was levied and collected under the Orissa
Sales Tax Act, 1947 from the respondents. Aggrieved, respondents filed writ
petitions on the ground that the transaction of sale and purchase of kendu
leaves between them and the Corporation were in course of inter-State trade
H
792
...
..
{
....
• """i
t
)'
STA TE OF ORISSA v. K.B. SAHA AND SONS INDUSTRIES PVL LTD.
793
because of sale/purchase had occasioned the movement of kendu leaves from
the State of Orissa to the State of West Bengal and as such it was exigible to
central sales tax under the Central Sales Tax Act, 1956 and not local Act i.e.
Orissa Sales Tax Act, 1947, and thus the excess amount collected from them
under the guise of State sales tax should be refunded High Court allowed the
writ petition holding that kendu leaves can only be delivered after submission
of necessary transport permit and the sale can only be completed after the
goods have been directed to move to the definite place as mentioned in the
transport permit, therefore, the pre conditions essential for a sale in course
of inter-State trade were satisfied and the transactions were inter-State sale
within the meaning ofS. 3(a) of the Central Act. Hence the present appeals.
Dismissing the appeals, the Court
HELD: 1. The High Court's view that the transactions were inter-State
sale within the meaning of S.3(a) of the Central Sales Tax Act, 1956, is
justifie~. Therefore, on the fact situation established no interference is called
for. [P~ra 28) [806-DJ
2.1. The nature of a transaction i.e. whether it is an inter-State or intra-
State would depend upon the factual scenario of the case under examination.
One of the Clauses on which the High Court has placed great reliance is
Clause 3. 7 that the tenderer shall be bound by all Forest Department rules
and regulations in connection with the purchase and transit of the forest
produce. [Para 12) [798-G, H; 799-AJ
2.2 In the tender document there was clear indication that the principal
place of business and additional place of business of the respondents were all
outside State of Orissa. The details of registrations under the West Bengal
Act and the Central Act were indicated. The way bill of transport and
consignment of goods dispatched from outside the State of West Bengal to
any place in West Bengal was also brought on record. Though mere knowledge
about the ultimate destination cannot be sufficient, yet cumulative effect of
the factual scenario has to be considered. (Paras 13 and 15) [799-B, C, El
2.3. In order to decide whExcerpt shown. Read the full judgment & AI analysis in Lexace.