The Supreme Court has observed that tax Administration Authorities cannot give their own interpretation to legislative provisions on the basis of their own perception of trade practices.
Based on this, the court held as illegal the circulars issued by the Rajasthan Commercial Tax department, which stated that goods imported from other states will be regarded as 'constructively delivered' after a reasonable period of lying with the transporter in the imported state.
Observing that the department had no authority to prescribe such cut-off date for termination of inter-state transit, the SC held that there is no concept of 'constructive delivery' of goods under the Central Sales Tax Act, 1956, and that the inter-state movement of goods will terminate only when the actual physical delivery is taken.
The case (Commercial Tax Officer vs M/s Bombay Machinery Store) pertained to the interpretation of Section 6(2) of the Central Sales Tax Act.
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Based on this, the court held as illegal the circulars issued by the Rajasthan Commercial Tax department, which stated that goods imported from other states will be regarded as 'constructively delivered' after a reasonable period of lying with the transporter in the imported state.
Observing that the department had no authority to prescribe such cut-off date for termination of inter-state transit, the SC held that there is no concept of 'constructive delivery' of goods under the Central Sales Tax Act, 1956, and that the inter-state movement of goods will terminate only when the actual physical delivery is taken.
The case (Commercial Tax Officer vs M/s Bombay Machinery Store) pertained to the interpretation of Section 6(2) of the Central Sales Tax Act.
READ FULL JUDGEMENT
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