JUDGMENT
J.M. Srivastava, J.
1. The five above-noted references by the Assam Board of Revenue (hereinafter referred to as “the Board”), under Section 32(4) of the Assam Sales Tax Act, 1947 (hereinafter referred to as “the Assam Act”), read with Section 9 of the Central Sales Tax Act, 1956 (hereinafter referred to as “the Act”), which raise the same three questions, were heard together and the questions referred are being answered by this common judgment.
2. The questions are :
(1) Whether, on the facts and in the circumstances of the case and on a true and correct interpretation of Sections 2(g), 3 and 6 of the Central Sales Tax Act, 1956, the Board of Revenue was justified in law in holding that the despatches in question made by the assessee to the three oil companies amounted to “sale” within the meaning of Section 2(g) of the said Act ?
(2) Whether the conclusion of the Board of Revenue holding the transactions to be “sale” is vitiated in law by reason of improper rejection and/or non-consideration of relevant materials and evidence on record and being based on surmises, suspicion and conjectures ?
(3) Whether, on the facts and in the circumstances of the case, the Board of Revenue was correct in law in not accepting the clear and categorical findings recorded by the Assistant Commissioner of Taxes (Appeals) regarding the despatches made by the assessee to the three on companies and was justified in law on the basis of the provisions of the Act applicable to the present case in placing the burden of proof on the assessee to show that the transactions in question did not amount to “sale” within the meaning of the Act and in recording its findings and conclusion on that basis?
3. Briefly, the relevant facts are that Assam Oil Co. Ltd., Digboi (hereinafter referred to as “the assessee”) had been carrying on the business of manufacturing petroleum and petroleum products at Digboi in Assam (hereinafter referred to as “the State”) and selling and supplying the same within the State as well as places outside the State. The assessee had at the instance of its agent, Burma Oil Company (India Trading) (hereinafter referred to as “the agent”), had despatched substantial quantities of different kinds of petroleum products (hereinafter referred to as “the goods”) to Indo Burma Petroleum Company Limited (IBPC), Standard Vacuum Oil Company (SVOC) and Caltex Limited (hereinafter referred to as “the companies”) outside the State during the periods ending September 30, 1959, March 31, 1960, September 30, 1960, March 31, 1961 and September 30, 1961. The assessee claimed to have despatched the goods to the companies to places outside the State under a “product exchange scheme” introduced by the Government of India and the companies had later returned in kind goods of equivalent value to the agent at different places outside the State. The Superintendent of Taxes held that the aforesaid transaction was movement of goods outside the State as an inter-State sale and as such, sale under the Act and liable for tax and accordingly, assessed the “tax” payable by the assessee. The assessee preferred appeal. The Assistant Commissioner of Taxes (Appeals), Jorhat, by order dated April 11, 1979, dismissed the appeals. On further appeal the Board also by order dated May 29, 1981, dismissed the appeal. The assessee prayed for reference and accordingly the questions noted earlier have been referred.
4. We have heard Mr. J.P. Bhattacharjee, learned counsel for the assessee and Mr. D.P. Chaliha, learned Government Advocate for the Revenue.
5. When sale of goods takes place in the course of inter-State trade or commerce as stipulated in Section 3 of the Act, the liability for tax under Section 6 of the Act arises. There is no dispute that the transaction did involve inter-State movement of goods, for admittedly, goods had been despatched by the assessee to the companies outside the State of Assam.
6. The main question, therefore, is that whether there was “sale” within the meaning of Section 2(g) of the Act.
Section 2(g) of the Central Sales Tax Act reads :
“Sale, with its grammatical variations and cognate expressions, means any transfer of property in goods by one person to another for cash or for deferred payment or for any other valuable consideration, and includes a transfer of goods on the hire-purchase or other system of payment by instalments, but does not include a mortgage or hypothecation of or a charge or pledge on goods.”
7. Mr. J.P. Bhattacharjee, learned counsel for the assessee, submitted that the “onus” was on the Revenue to prove that the transaction was sale and cited Commissioner of Sales Tax v. S.C. Jain [1988] 70 STC 45 (SC). We agree that in a taxing statute the onus lies on the Revenue to establish that the transaction was “sale” so as to be liable to incidence of tax and it was not for the assessee to prove that the transaction was not “sale”. However, after the evidence had been produced and the basic relevant facts had been ascertained the question of “onus” could only be of academic significance.
8. Mr. J.P. Bhattacharjee, learned counsel for the assessee, has submitted that the transaction even though it involved inter-State movement of goods was not “sale” but was “barter” because as consideration for the goods despatched by the assessee at the instance of its agent to the companies, the latter (the companies) had returned goods to the agent and consequently the transaction was not sale. In this connection reference was made to definitions of “sale” in Section 54 and of “exchange” in Section 118 of the Transfer of Property Act, 1882 and it was submitted that “sale” was clearly different from “exchange” also known as barter. It was also submitted that “sale” under Section 4 of the Sale of Goods Act, 1930, takes place when the property in goods has passed to the purchaser for a price, which generally means monetary consideration and it was argued that since in the transactions under consideration the “property in goods” had passed to the “companies” (even though at the instance of the agent) when the assessee had despatched the goods and the “companies” had returned in kind similar goods to the agent, the transaction in so far as the assessee was concerned was complete and since no monetary consideration had been obtained by the agent for the said goods from the companies the transaction could not be sale. It was contended that the expression “any other valuable consideration” in Section 2 of the Central Sales Tax Act had to be confined to mean only transactions like hundi, etc., and could not cover exchange of goods.
9. We think that the question under consideration has to be resolved on the basis of the definition of “sale” as in the “Act” itself even though for appreciation, the definition or meaning of expression “sale” in other laws may also be referred mainly for the reason, that each “law” is enacted with some purpose in view and when the law defines a “term” or “expression” its meaning and scope clearly has nexus with the purpose of the law and consequently the ordinary plain meaning of the words, used in defining a particular “term” or “expression” should be attributed to understand its meaning and scope, in the instant case “sale” in Section 2(g) of the Act.
10. In the general law of transfer of property obviously “sale” as transaction relating to property was different from exchanges. However, in the Prevention of Food Adulteration Act, 1954 “sale” in its Section 2(xiii) is defined to include “by way of exchange”, obviously a much wider definition in an attempt possibly to take care of human ingenuity in such matter to achieve the purpose of the law. The question that whether “transaction” was sale or not has therefore to be determined on consideration of the definition of “sale” in the Act itself.
11. The transfer of property in goods by the assessee was obviously not for “cash”. Whether it was for “other valuable consideration” ? While we are inclined to think that the transfer of property in goods was for other valuable consideration because the expression “valuable consideration” has very wide scope and is preceded by the word “other” after the words, “cash” and “deferred payment” which should mean “any valuable consideration”.
12. Shri J.P. Bhattacharjee, has cited Devi Dass Gopal Krishnan v. State of Punjab [1967] 20 STC 430 (SC), where the expression “valuable consideration” in the definition of “purchase” as in Section 2(ff) of the Punjab General Sales Tax Act which was similar to the definition of “sale” in Section 2(g) of the Act, came up for consideration in the context of the question of competency of the State Legislature to make the amendment in the law and it was held by the Supreme Court that “the expression ‘valuable consideration’ took colour from the preceding expression ‘cash’ or ‘deferred payment’ and only meant some other monetary payment in the nature of cash or deferred payment”. Shri Bhattacharjee, has, therefore, contended that in view of the above meaning and scope of “valuable consideration” as interpreted by the Supreme Court the said expression in Section 2(g) of the Act cannot have any other meaning and hence the transaction under consideration where “goods” had been obtained by “the agent” in return for the “goods” despatched by the assessee, the transaction being barter, would not be sale.
13. We have considered the submission and while with respect, we do think that on plain ordinary grammatical construction of expression “other valuable consideration” its meaning and scope could be wider and not restrictive, in light of preceding expression “cash” or “deferred payment”, we have to accept the meaning of “valuable consideration” as laid down by the Supreme Court. Accordingly, we agree with Shri J.P. Bhattacharjee that for the aforesaid reason the transaction was not “sale”. However, whether the despatch of goods was for “deferred payment” should also be considered.
14. The assessee, it is true, at the instance of its agent had despatched goods outside the State to the companies and the latter had given similar goods of equivalent value to the agent, as appears from the documents on record, but it was also a fact that finally the assessee had received from the agent the monetary value of the said goods (which the assessee had earlier despatched under instructions of the agent to the companies). While, therefore, the assessee did not immediately receive payment and the agent in return for the goods despatched to the companies by the assessee had then received goods in exchange from the companies and so far as the goods were concerned the delivery had been made and property therein had passed, yet we see no reason to restrict the consideration of facts only up to that stage and exclude from consideration the subsequent and very material fact that the agent, having sold the goods received in exchange from the companies for the goods the assessee had despatched to the companies, had paid the monetary value of the “goods” to the assessee, later. Mr. J.P. Bhattacharjee, learned counsel for the assessee, has submitted that there is a very fine distinction between the transaction in so far as the goods despatched by the assessee were concerned, in that, for the said goods the agent had received similar goods in exchange and there the matter so far as the “goods” were concerned came to an end, i.e., the property in goods having had passed the transaction of sale was completed or concluded and accordingly, the transaction, was not sale but just barter and in view of Devi Dass [1967] 20 STC 430 (SC) there was nothing left so far as the transaction was concerned for consideration. We have found it difficult to accept this submission because we do not find it reasonable to take the view that the transaction was over, because, in so far as the assessee was concerned, the goods having been despatched earlier and the agent having had received the goods in return, the transaction was not yet concluded and was still in process until the assessee had received the price or monetary value of the goods despatched earlier. The transaction of “sale” under the Act, in view of its purpose, clearly has very close nexus with the assessee, for the incidence of tax on the transaction falls on the assessee. Accordingly, in our opinion, in so far as the assessee was concerned, the transaction of transfer of its goods came to conclusion only when the assessee had received payment from its agent even though later, may be much later. We, therefore, think that the transfer of property in goods to the companies so far as the assessee was concerned had taken place for “deferred payment” and, therefore, the transaction was “sale” within the meaning and scope of Section 2(g) of the Act. Mr. J.P. Bhattacharjee, learned counsel for the assessee, has emphasised the fact that the transaction was in pursuance of a programme for product exchange and further that the assessee had despatched the goods at the instance of its agent in pursuance to an agreement made earlier on January 17, 1956. We have seen the agreement between the assessee and its agent whereunder the agent had agreed to market the goods of the assessee both outside and within the State. Since the facts are undisputed that the assessee had at the instance of its said agent despatched the goods to the aforesaid companies and subsequently the agent had remitted the proceeds of the sale of the petroleum products, obtained in exchange from the companies, in so far as the assessee was concerned, he had undoubtedly received the price or value of the goods and the transaction as stated earlier, was sale in the course of inter-State trade. In so far as the product exchange programme is concerned, the Revenue authorities have taken the view that the assessee had nothing to do with it. In our opinion, it hardly makes any difference to the conclusion, that the transaction was sale, for the assessee had obtained payment for the goods despatched earlier, from its agent and it was clearly a case of deferred payment. It was, therefore, not material that the assessee had nothing to do with the product exchange programme in the sense that the assessee was not a party to it.
15. For the aforesaid reasons, we answer question No. 1 in favour of the Revenue.
16. In view of our answer to question No. 1, we do not consider it necessary to answer the other two questions.
17. We leave the parties to bear their own costs.
A. Raghuvir, C.J.
18. I agree.