By C. B. Thakar | Advocate
G. G. Goyal, Janak Vaghani | Chartered Accountants
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Inter-State sale — Claim of sale against Form C — Cancellation of registration from 1-7-2002 — Rejection of claim not valid for sale subsequent to the date of cancellation where the assessee had no knowledge of it — Section 8 of the CST Act, 1956.
Facts :
The dealer claimed inter-State sale of goods taxable at concessional rate of 4% against form C during the period of assessment for the year 2002-2003. The registration of the purchasing dealer was cancelled from 1-7-2002, therefore, the Department disallowed the inter-State sales against form C effected after 1-7-2002 i.e. after the date of cancellation of registration certificate of the purchasing dealer. In appeal filed before the Tribunal, the disallowance of such claim was confirmed. The dealer filed revision petition before the High Court. The High Court held in favour of the dealer.
Held :
When the purchasing dealer had issued C form for the subsequent period after the date of cancellation of registration and the selling dealer had claimed concessional rate of tax without knowledge as to whether the purchasing dealer has ceased to exist from July 1, 2002, then it cannot be held that the C forms issued by the purchasing dealer are invalid.
It is not for the assessee to actually find out as the registered dealer was in existence as on the date, when the sales were effected when in fact, the registered dealer who is the purchaser has issued C forms to the assessee.
If at all there has been any violation committed by the purchaser, the selling dealer cannot be found fault with, since it was the duty of the purchaser to have informed the petitioner about its ceasing to be in existence and thereby not issuing C forms. The High Court allowed the petition accordingly in favour of the dealer.
