# The Commissioner, Commercial Tax, U.P. Lucknow v. S/S. Raj Kumar Amit Kumar, Jahangeerabad

- **Citation:** (2024) 4 ILRA 1012
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2024-03-05
- **Case number:** Sales/Trade Tax Revision No. 549 of 2013
- **Bench:** Shekhar B. Saraf
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/the-commissioner-commercial-tax-u-p-lucknow-v-s-s-raj-kumar-amit-kumar-51729
- **Pages:** 6

## Headnote

Civil Law - Central Sales Tax Act, 1956 -
Section 5(3) - U.P. Value Added Tax Act,
2008 - Sales/Trade Tax Revision - Revisionist
challenged Tribunal's order granting exemption
under Section 5(3) for paddy sales, claiming they
were "sale for export" rather than "sale in the
course of export." Court held: (1) Tribunal's finding
that sales were in the course of export was
supported by certificates of foreign buyers,
purchase orders, bills of lading, and Form-H,
establishing an inseverable link between the sale
and export (St. of Karn. Vs Azad Coach Builders
Pvt. Ltd., (2010) 9 SCC 524). (2) Section 5(3)
exemption applies when sale and export are
inextricably linked, requiring intention to export,
obligation to export, and actual export, which were
satisfied in this case (Babu Kalika Prasad Traders
Vs Commissioner Commercial Tax, 2012 N.T.N.
Vol-49, p. 218). (3) Revisional jurisdiction under
UPVAT Act is limited to correcting jurisdictional
errors or egregious legal mistakes, not reevaluating
factual
findings
unless
perverse;
Tribunal's findings were based on evidence and not
perverse (Hindustan Petroleum Corporation Ltd. Vs
Dilbahar Singh, (2014) 9 SCC 78). (4) First
Appellate Authority erred in ignoring factual
evidence of export linkage, while Tribunal correctly
applied
legal
principles.
Revision
dismissed;
Tribunal's order upheld. (Paras 7-14)

Revision Petition Dismissed.

List of Cases cited:

## Text

1012 INDIAN LAW REPORTS ALLAHABAD SERIES
proceedings and similarly the order of
provisional attachment dated 05.01.2023 is
also held to be without any basis.

27. Thus, the impugned show cause
notice dated 05.01.2023 issued under 24(1)
of the Benami Transactions Act and also
the provisional attachment order dated
05.01.2023 issued under Section 24(3) of
the Act, are hereby set aside. All the
consequential orders and proceedings on
the basis of aforesaid show cause notice
dated
5.1.2023
and
the
provisional
attachment order dated 5.1.2023, stand
non-est and void.

28. The writ petition is allowed.
----------
(2024) 4 ILRA 1012
REVISIONAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 05.03.2024

BEFORE

THE HON'BLE SHEKHAR B. SARAF, J.

Sales/Trade Tax Revision No. 549 of 2013

The Commissioner, Commercial Tax, U.P.
Lucknow ...Applicant
Versus
S/S. Raj Kumar Amit Kumar,
Jahangeerabad ...Opposite Party

Counsel for the Applicant:
S.C.

Counsel for the Opposite Party:
Sri Suyash Agarwal, Sri R.R. Agarwal (Sr.
Adv.)

Civil Law - Central Sales Tax Act, 1956 -
Section 5(3) - U.P. Value Added Tax Act,
2008 - Sales/Trade Tax Revision - Revisionist
challenged Tribunal's order granting exemption
under Section 5(3) for paddy sales, claiming they
were "sale for export" rather than "sale in the
course of export." Court held: (1) Tribunal's finding
that sales were in the course of export was
supported by certificates of foreign buyers,
purchase orders, bills of lading, and Form-H,
establishing an inseverable link between the sale
and export (St. of Karn. Vs Azad Coach Builders
Pvt. Ltd., (2010) 9 SCC 524). (2) Section 5(3)
exemption applies when sale and export are
inextricably linked, requiring intention to export,
obligation to export, and actual export, which were
satisfied in this case (Babu Kalika Prasad Traders
Vs Commissioner Commercial Tax, 2012 N.T.N.
Vol-49, p. 218). (3) Revisional jurisdiction under
UPVAT Act is limited to correcting jurisdictional
errors or egregious legal mistakes, not reevaluating
factual
findings
unless
perverse;
Tribunal's findings were based on evidence and not
perverse (Hindustan Petroleum Corporation Ltd. Vs
Dilbahar Singh, (2014) 9 SCC 78). (4) First
Appellate Authority erred in ignoring factual
evidence of export linkage, while Tribunal correctly
applied
legal
principles.
Revision
dismissed;
Tribunal's order upheld. (Paras 7-14)

Revision Petition Dismissed.

List of Cases cited:

1. St. of Karn. Vs Azad Coach Builders Pvt. Ltd.,
(2010) 9 SCC 524 (Para 4, 9)

2. Babu Kalika Prasad Traders Vs Commissioner
Commercial Tax, 2012 N.T.N. Vol-49, p. 218
(Para 4)

3. Hindustan Petroleum Corporation Ltd. Vs
Dilbahar Singh, (2014) 9 SCC 78 (Para 13)

4. Mohd. Inam Vs Sanjay Kumar Singhal, (2020)
7 SCC 327 (Para 13)

5. The Commissioner, Commercial Tax U.P. Vs
M/s Godfrey Philips India Ltd., 2024:AHC:22365
(Para 13)

(Delivered by Hon'ble Shekhar B. Saraf, J.)

(Judgement dictated in Open Court)

1. Heard Sri Bipin Kumar Pandey,
learned counsel appearing on behalf of the
revisionist and Sri R.R. Agarwal, learned
4 All. The Commissioner, Commercial Tax, U.P. Lucknow Vs. S/S. Raj Kumar
 Amit Kumar, Jahangeerabad
1013
Senior Advocate assisted by Sri Suyash
Agarwal, Counsel for the respondent.

2. This is a revision petition filed by
the State wherein the following question of
law has been admitted :-

"Whether under the facts and
circumstances of the case, the Commercial
Tax Tribunal was legally justified in
granting exemption u/s 5(3) of Central
Sales Act treating the transaction as sale in
the course of export whereas the sale was
for export to Ex. U.P. exporter?"

3. The case of the revisionist is that
the finding of the first Appellate Authority
was that the dealer in the present case was
acting as an agent of the farmers and was
auctioning the paddy to the highest bidder.
The authority came to the conclusion that
since the paddy was being auctioned to the
highest bidder, even if the paddy was
thereafter exported, the same would not
come within the definition of "Sale in The
Course of Export" and would be only 'Sale
For Export'. The relevant part of the order
of the first Appellate Authority is provided
below :-

''व्यापारी तथ्यात्मक रूप से इसे
प्रमाम्णत निीं कर सके िैं और अपने स्पष्टीकरण
में एक ओर धनयाजतक व्यापारी का प्रमाणपर्त्र
दाम्खि कर रिे िैं म्जसके अनुसार धनयाजतक के
िय आदेि के विरूद्ध उन्िोने माि की वबिी की
िै ििी दूसरी ओर अपने स्पष्टीकरण में यि कर
रिे िै हक काश्तकार के माि की खुिी बोिी
िगाकर कच्ची आढत में अधिकतम बोिी
िगाने िािे व्यवि को उनके द्वारा माि की वबकी
की गई िै। स्पष्ट िै हक िारा-5(3) का अनुपािन
सुधनम्श्चत निीं िो रिा िै इसधिए व्यापारी को
इस आिार पर भी उि समव्यििारों पर िूर् देय
निीं िै। माननीय उच्च न्यायािय तर्था सिोच्च
न्यायािय ने अनेकानेक धनणजयों में "Sale For
Export'' तर्था "Sale in The Course of Export
'' के अन्तर को स्पष्ट हकया िै तर्था यि
व्यिस्र्था दी िै हक केन्रीय अधिधनयम की िारा
5(3) में केिि "Sale in The Course of Export
'' पर िी करमुवि िै तर्था "Sale For Export''
इस िारा में करमुि निीं िोगी।"

4. Against the above order, the
dealer/respondent went in appeal before the
Tribunal, wherein the Tribunal took into
consideration
the
judgement
of
the
Allahabad High Court in Babu Kalika
Prasad
Traders
Vs.
Commissioner
Commercial Tax reported in 2012 N.T.N.
Vol-49 page 218, which had considered the
Supreme Court judgement in State of
Karnataka Vs. Azad Coach Bilders Pvt.
Ltd. and Ors. reported in (2010) 9 SCC
524.
Upon
considering
the
above
judgements, the Tribunal came to the
following finding:-

"उपरोि के समबन्ि में व्यापारी द्वारा
ज्िाइन्र् कधमश्नर (कायजपािक) के समक्ष अपने
स्पष्टीकरण
के
सार्थ
सिजश्री
बेस्र्
फूड
इण्र्रनेिनि प्राoधिo द्वारा जारी दो प्रमाण पर्त्र
दाम्खि हकये िैं, म्जनमें यि प्रमाम्णत हकया
गया िै हक उन्िें विदेिी धनयाजतक के आदेिों (4
आदेिों के संख्या एिं हदनांक उम्लिम्खत िैं) इस
व्यापारी से (4 परचेज आडजर का उलिेख हकया
गया िै) परचेज आडजर िेकर िान की खरीद की
गयी िै। इसी प्रकार दूसरे प्रमाण पर्त्र में विदेिी
1014 INDIAN LAW REPORTS ALLAHABAD SERIES
िेता के एक आदेि का उलिेख करते िुए इसके
िम में धनयाजतक द्वारा इस व्यापारी को जारी
िय आदेि का उलिेख करते िुए यि प्रमाम्णत
हकया गया िै हक इन आदेिों के आिार पर की
गयी खरीद से धनधमजत चािि को देख के बािर
धनयाजत हकया गया िै। अतः ज्िाइन्र् कधमश्नर
(कायजपािक) द्वारा पाररत आदेि इस सीमा तक
उधचत निीं िै। सिजश्री सतनाम ओिरसीज को
की गयी वबिी रूo 783756.00 के समबन्ि में
व्यापारी द्वारा कोई प्रमाण पर्त्र दाम्खि निीं
हकया िै। इस स्तर पर भी सिजश्री सतनाम
ओिरसीज को की गयी वबिी रूo 783756.00 के
समबन्ि में विदेिी िेता का कोई परचेज आडजर
या अन्य साक्ष्य निीं प्रस्तुत हकया गया िै। अतः
सिजश्री सतनाम ओिरसीज से समबम्न्ित फामजएच को मान्यता प्रदान न करने से समबम्न्ित
विद्वान ज्िाइन्र् कधमश्नर (कायजपािक) द्वारा
पाररत आदेि हदनांक 18.06.12 को आंधिक रूप
से स्िीकार हकये जाने योग्य िै।
आदेि

अपीिकताज व्यापारी द्वारा दायर
हद्वतीय अपीि अंितः स्िीकार की जाती िै।
ज्िाइन्र् कधमश्नर (कायजपािक) द्वारा पाररत
आदेि
को
संिोधित
करते
िुए
रूo
2,01,98,089.00 पर 8 प्रधतित की दर से
आरोवपत कर रूo 16,15,847.00 समाप्त हकया
जाता िै। अपीिकताज व्यापारी ने यहद इस
समबन्ि में िनराधि जमा की गयी िै तो यि
िनराधि अपीिकताज को िापस की जाये।"

5. Counsel appearing on behalf of
revisionist Mr. Bipin Kumar Pandey argued
that in the present case no clear finding
could be reached with regard to the goods
being sold in the course of export, and
accordingly, argued that the benefit of
Section 5(3) of Central Sales Act, 1956
(hereinafter referred to as the 'Act') would
not be applicable, and therefore, exemption
would not be available to the dealer. He
relied on the order passed by the first
Appellate
Authority
to
buttress
his
arguments.

6. Per contra, Mr. R.R. Agarwal,
Senior Advocate appearing on behalf of the
dealer/respondent has placed reliance on
the case of Azad Coach Builders Pvt. Ltd.
(Supra).

7. Upon considering the arguments
placed by counsel appearing on behalf of
both the parties and upon perusal of the
orders passed by the first Appellate
Authority and the Tribunal, I am of the
view that the first Appellate Authority did
not consider certain factual aspects that
have
later been
considered by
the
Tribunal.

8. The undisputed facts that emerge
from the order passed by the Tribunal are
that the dealer/respondent had produced
certificate of the foreign buyers, purchase
orders of the foreign buyers, bills of lading
and the Form-H as required under the Act.
These documents strengthened the belief of
the Tribunal that the sales were made by
the dealer/respondent in the course of
export.

9. One may also rely on the relevant
paragraphs of the judgement passed in
Azad Coach Builders Pvt. Ltd. (Supra) that
explains the interpretation of Section 5(3)
of the Act. Relevant paragraphs are
delineated below :-
4 All. The Commissioner, Commercial Tax, U.P. Lucknow Vs. S/S. Raj Kumar
 Amit Kumar, Jahangeerabad
1015

"23. When we analyse all these
decisions in the light of the Statement of
Objects and Reasons of the amending Act
103 of 1976 and on the interpretation
placed on Section 5(3) of the CST Act, the
following principles emerge:

To constitute a sale in the course
of export there must be an intention on the
part of both the buyer and the seller to
export.

There must be obligation to
export, and there must be an actual export.

The obligation may arise by
reason of statute, contract between the
parties, or from mutual understanding or
agreement between them, or even from the
nature of the transaction which links the
sale to export.

To occasion export there must
exist such a bond between the contract of
sale and the actual exportation, that each
link is inextricably connected with the one
immediately preceding it, without which a
transaction sale cannot be called a sale in
the course of export of goods out of the
territory of India.

24. The phrase "sale in the course
of export" comprises in itself three
essentials: (i) that there must be a sale; (ii)
that goods must actually be exported; and
(iii) that the sale must be a part and parcel
of the export. The word "occasion" is used
as a verb and means "to cause" or "to be
the immediate cause of". Therefore, the
words "occasioning the export" mean the
factors, which were the immediate cause of
export. The words "to comply with the
agreement or order" mean all transactions
which are inextricably linked with the
agreement or order occasioning that
export. The expression "in relation to" are
words of comprehensiveness, which might
both have a direct significance as well as
an indirect significance, depending on the
context in which it is used and they are not
words of restrictive content and ought not
be so construed.

25. Therefore, the test to be
applied is, whether there is an inseverable
link between the local sale or purchase on
export and if it is clear that the local sale
or purchase between the parties is
inextricably linked with the export of the
goods, then a claim under Section 5(3) for
exemption from State sales tax is justified,
in which case, the same goods theory has
no application."

10. It may be noted that circular
No.66/31-3-99
issued
by
the
Commissioner, Commercial Tax, Uttar
Pradesh, also clarifies the situation wherein
the benefit of exemption is to be granted to
the dealer. Relevant paragraph is quoted
below :-

"3-
उत्तर
प्रदेि
व्यापार
कर
अधिधनयम-1948 के अन्तगजत िान की प्रर्थम
खरीद पर कर देय िै। धनयाजतक को िान की
वबिी करने िािे व्यापारी अगर हकसान से िान
धनजी खाते या अन्य वप्रंधसपि के धिए खरीद
करके, धनयाजतक व्यापारी को ऐसे िान की वबिी
करता िै तो उसे िान की खरीद पर िय कर देना
िोगा क्योंहक हकसान और उनसे खरीदने िािे
व्यापारी के बीच समव्यििार केन्रीय वििय कर
अधिधनयम की िारा-5(3) के अन्तगजत निीं
आता िै िेहकन अगर हकसान का िान कोई
1016 INDIAN LAW REPORTS ALLAHABAD SERIES
व्यापारी अपनी सेधिंग एजेन्सी में धनयाजतक
व्यापारी को बेचता िै और िारा 5(3) की ितों
को पािन िोता िै तो ऐसी वबिी पर कोई कर
देय निीं िोगा।''

11. Upon a perusal of aforesaid
paragraph, it is clear that the nature of sale,
if it is in the course of export, is exempted
under Section 5(3) of the Act.

12. From a reading of the order
passed by the Tribunal, it is crystal clear
that the Tribunal has relied upon the
certificate of the foreign buyers, purchase
orders of the foreign buyers, bills of lading
and the Form-H submitted under the Act to
come to a finding that in the present case
the goods were sold in the course of export.
Based upon this finding, the Tribunal had
come to the finding that the sale is
exempted under Section 5(3) of the Act.

13. This Court in The Commissioner,
Commercial Tax U.P. v. M/s Godfrey
Philips India Limited [Neutral Citation
No. - 2024:AHC:22365 (Sales/Trade Tax
Revision No.150 of 2023 decided on
February 12, 2024)] after considering the
Supreme Court judgements in Hindustan
Petroleum
Corporation
Limited
v.
Dilbahar Singh reported in (2014) 9 SCC
78 and in Mohd. Inam v. Sanjay Kumar
Singhal and others reported in (2020) 7
SCC 327 had came to the finding that is
delineated below :-

"12. The principles governing the
exercise of revisional jurisdiction under the
UPVAT Act, 2008 are imbued with a
presumption
of
finality
attached
to
judgments and orders pronounced by the
appellate authorities. High Courts, in their
capacity as revisional bodies, are entrusted
with the solemn duty of upholding the
sanctity of such judgments and orders, and
such, should not lightly disturb them unless
compelling
reasons
of
paramount
significance necessitate such intervention.
It
is
imperative
to
underscore
that
revisional jurisdiction is not designed as a
mechanism
for
the
indiscriminate
prelitigation of cases or the unwarranted
reopening of matters that have been
adjudicated
and
settled
through due
process. High Courts, in the exercise of
their
revisional
jurisdiction
are
circumscribed
by
certain
fundamental
principles that underscore the sanctity of
factual findings arrived at by lower courts
or tribunals. Ordinarily, High Courts are
precluded from intervening in factual
findings unless such findings exhibit
characteristics of perversity, are predicated
on no evidence whatsoever, or evince a
palpable and egregious error of law. The
cardinal principle underlying revisional
jurisdiction mandates that High Courts
refrain from engaging in the revaluation of
factual
evidence
or
arrogating
to
themselves the authority to substitute their
own findings for those meticulously arrived
at by the lower courts or tribunals.

13. Revisional jurisdiction, as
envisaged under the UPVAT Act, 2008, is
meticulously
tailored
to
address
jurisdictional errors and excesses of law
that may have permeated the adjudicative
process at lower echelons of the judicial
hierarchy. It is incumbent upon High
Courts,
when
exercising
revisional
jurisdiction, to vigilantly scrutinize the
legal landscape and ascertain whether the
impugned judgment or order suffers from
any infirmities of jurisdictional import or
egregious deviations from the normative
contours of legal propriety. The legislative
intent underpinning the conferment of
4 All. M/s United Spirits Ltd., Shajahnpur Vs. State of U.P. & Ors.
1017
revisional jurisdiction upon High Courts is
imbued with a profound commitment to the
principles of judicial economy, finality, and
legal certainty. Revisional jurisdiction is
not conceived as a vehicle for the
protracted
re-examination
of
factual
matrices, or the interminable redressal of
grievances
already
exhaustively
adjudicated upon by the lower courts or
tribunals.
Rather,
it
constitutes
an
instrumental mechanism for rectifying
egregious legal errors or jurisdictional
excesses that may have vitiated the
adjudicative process, thereby ensuring the
equitable and efficacious administrative of
justice."

14. In view of the above, I find no
reason to interfere in the order passed by
the Tribunal as the findings of the Tribunal
are based on the materials placed before it
and not a figment of their imagination.
There is no perversity whatsoever in the
order
passed
by
the
Tribunal,
and
accordingly, the same is upheld. The
question of law is answered against the
revisionist
and
in
favour
of
the
dealer/respondent.

15. Ergo, the revision petition is
dismissed.
----------
(2024) 4 ILRA 1017
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 14.03.2024

BEFORE

THE HON'BLE SHEKHAR B. SARAF, J.

Writ Tax No. 619 of 2023

M/s United Spirits Ltd., Shajahnpur
 ...Petitioner
Versus
State of U.P. & Ors. ...Respondents
Counsel for the Petitioner:
Sri Harshul Bhatnagar

Counsel for the Respondents:
C.S.C.

Civil Law - U.P. Entry of Goods into Local
Area Act, 2007 - Sections 1(3), 17 & 18 -
U.P. Entry of Goods into Local Area Tax
Act, 2000 - Section 4(A) - U.P. Sales Tax
Rules, 2000 - Rule 41(5) - Constitution of
India,1950 - Article 226 - Writ Petition -
Petitioner challenged provisional assessment
order dated April 19, 2006, final assessment
order dated March 30, 2008, and appellate
order dated December 31, 2022, imposing entry
tax of Rs. 2,78,02,393/- on Indian Made Foreign
Liquor (IMFL). Court held: (1) The U.P. Entry of
Goods into Local Area Tax Act, 2000, was
declared ultra vires by the Allahabad High Court,
and proceedings under the New Act (2007)
apply, but IMFL is not listed in the schedule of
taxable goods under the New Act, rendering the
imposition of entry tax without jurisdiction. (2)
The appellate authority failed to address the
petitioner's argument regarding the absence of
IMFL in the New Act's schedule, making the
order
unreasoned
and
non-speaking.
(3)
Authorities lacked jurisdiction to impose entry
tax on goods not included in the New Act's
schedule, and the issue of non-inclusion goes to
the root of the matter. Impugned appellate
order dated December 31, 2022, quashed;
matter remanded to the authority for a
reasoned order addressing the non-inclusion of
IMFL in the schedule, to be completed within
three months. (Paras 4-9)

Writ Petition Allowed.

(Delivered by Hon'ble Shekhar B. Saraf, J.)

1. Heard Sri Harshul Bhatnagar,
counsel appearing on behalf of the
petitioner and Sri Rishi Kumar, learned
Additional
Chief
Standing
Counsel
appearing for the State respondents.

2. This is a writ petition under Article
226 of the Constitution of India wherein the
writ
petitioner
is
aggrieved
by
the