Claim For Sales Tax Exemption In Respect Of Transit Sales To Be Justified By Showing Sale As Having Occurred In Transit: Kerala High Court

The Kerala High Court has held that a claim for exemption in respect of transit sales must be justified by showing the sale as having occurred in transit.The bench of Justice A.K. Jayasankaran Nambiar and Justice Syam Kumar V.M. has observed that the petitioner/assessee cannot establish the transit sales by showing the sale as having occurred in transit since the E1 Forms relied on by the assessee have been accounted for only in a subsequent year, which could only be after the transportation of the goods and not while the goods were in transit.The petitioner/assessee has filed the sales tax revision petition against the order of the tribunal. The Appellate Tribunal did not consider the claim for in transit with regard to Rs. 5,83,33,441, which is supported by Form E1. Sellers can issue E1 (first sale) and E2 (subsequent sales) when doing interstate sales to produce before assessing authorities within the prescribed time. The Tribunal found that, as per the statutory provisions, the sales in transit had to be evidenced by statutory forms in Form-E1 under the Central Sales Tax (Registration and Turnover) Rules. In support of the claim for exemption on transit sales, the petitioner had produced E-Forms that pertained to sales effected in 2002–03, whereas the claim for exemption for transit sales was in respect of the assessment year 2001–02. The Tribunal held that subsequent sales of goods affected in 2002–03 could not be considered transit sales of goods purchased in 2001–02, since the transportation of the goods stood complete in all respects in 2001–02 itself.The petitioner contended that copies of the relevant E-forms that were accounted for in the subsequent years are available with the petitioner, and they can be produced before the authorities for verification.The court stated that “we fail to see how that would be of any assistance to the petitioner since it is trite that the claim for exemption in respect of transit sales must be justified by showing the sale as having occurred in transit. As already noticed, the petitioner cannot establish the aforesaid fact since the E1 forms relied on by him have admittedly been accounted for only in a subsequent year, which could only be after the transportation of the goods and not while the goods were in transit.”.The court refused to interfere with the finding of the Appellate Tribunal and dismissed the petition by answering the questions of law against the assessee.Counsel For Petitioner: T.M.SreedharanCounsel For Respondent: Chief Secretary To GovernmentCitation: 2024 LiveLaw (Ker) 336Case Title: M/S.I.T.I.LTD Versus State Of KeralaCase No.: ST.REV. NO. 1 OF 2017Click Here To Read The Order

Claim For Sales Tax Exemption In Respect Of Transit Sales To Be Justified By Showing Sale As Having Occurred In Transit: Kerala High Court

Mariya Paliwala

This is a premium content
Available exclusively to
Our subscribers

INR 1099+GST

Tags

Claim For Sales Tax Exemption In Respect Of Transit Sales To Be Justified By Showing Sale As Having Occurred In Transit: Kerala High Court

Mariya Paliwala

This is a premium content Available exclusively to Our subscribers

INR 1099+GST

Tags

This is a premium content
Available exclusively to
Our subscribers