CST - Contract executed for Electricity Board - Petitioner made sale in-transit & sought for C Form - Whether Board can seek proof of payment of tax? - Held No - Board directed by HC to issue Form C upon petitioner producing E-2 certificate
By TIOL News Service
ERNAKULAM, JUNE 25, 2015: PETITIONER executed contract for Kerala State Electricity Board. Petitioner purchased goods from outside the State and transferred the same to the Board by way of sale in-transit. Petitioner furnished 'C' Form to the seller who in turn issued Form E1 to enable the petitioner avail the benefit under Section 6(2) of the CST Act 1956. Petitioner sought for C Form from the Board to avail the benefit under Section 6(2) of the CST Act. Board denied “C” Form on the ground that petitioner did not produce proof of payment of tax under the CST Act. On refusal by Board to issue Form C, Petitioner filed writ of mandamus directing the Board to issue ‘C' Form for the value of materials supplied.
High Court observed that first sale alone will be taxable and the tax on subsequent sale will be exempted if dealers are registered. Court further held that Board cannot insist on proof of tax paid by the first seller but can only demand Form E-2 from the petitioner. Court held that since Board has already admitted supply of materials by the petitioner, they are bound to issue “C” Forms. Accordingly, High Court directed the Board to issue “C” Forms to the petitioner as and when petitioner produces E-2 certificate.
(See 2015-TIOL-1492-HC-KERALA-CT)
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