ORDER
V.K. Singhal, J.
1. Both these appeals are disposed of by this common judgment. Following questions have been raised by the assessee :
1. Whether, on the facts and in the circumstances of the case, the order of the appellate authority is erroneous and prejudicial to the interest of the Government revenue ?
2. Whether, on the facts and in the circumstances of the case, the judicious discretion of the appellate authority could be subject for consideration under the revisionary powers envisaged under the Section 22-A of the Act ?
3. Whether, on the facts and in the circumstances of the case, the respondent is vested with the jurisdiction to invoke the provisions of Section 22-A of the Karnataka Sales Tax Act, 1957 ?
4. Whether the respondent was right in ignoring the fact that the assessing authority had examined the movement of consignment without examining the effect of the letters as the whole. The appellate authority examining the effect of the letters in its entirety on the movement of cashew kernels. This aspect of the matter was not considered by the respondent ?
5. Whether the first respondent was right in ignoring the fact that in the case of inter-State sale each and every transactions is to be examined by the authority and leave their findings on the same ?
6. Whether the respondent is right in holding that the transactions entered are clear sales in the course of inter-State sales ignoring the fact that there were transfers otherwise than by way of sale ?
7. Whether the respondent is right in observing that the inter-State movement was incidental to the order placed by Mahalsa Enterprises, Mangalore, and there is no evidence to say that said Sri Mohan Kamath acted as the representative when there was no orders from the said Mohan Kamath ?
8. Whether the first respondent was right in not examining the fact that “F” form can be availed of only by commission agents and not by dealers and when the consignee used the “F” forms, the same is for sales as agent and not as dealers ?
2. The facts of the case are that the assessee is engaged in the manufacture of cashew kernels. Assessment for the year September 1, 1985 to August 31, 1986 was framed on August 29, 1989. The dispute is with regard to the transactions whether they are inter-State sales or transfer to the agent for sale outside the State. Deputy Commissioner, Appeals remanded the matter for framing the fresh assessment. A.C.T.O., Intelligence, Bangalore, inspected and searched the business premises of the assessee on May 7, 1987 and seized certain books of account and documents. It was found that consignment sales to the tune of Rs. 11,65,140 were shown which were supported by “F” form and sale patties. On the basis of the seized record it was noticed that the goods have moved from the State of Karnataka to the customers outside the State as a result of privity of contract. Transactions of Rs. 9,34,870 were considered as inter-State sale. Letter of the assessee addressed to Vishal Trading Company to the effect that 98 cases of cashew kernels were supplied on the instruction of Sri Mohan Kamath of Mahalsa Enterprises on September 26, 1985 and the pro forma invoice No. 508 for Rs. 1,60,240 was taken into consideration. From the sale patti it was found that the sale price after deducting the expenses was of the value shown in the pro forma invoice and accordingly the transaction under invoice Nos. 508 to 518 were considered as inter-State sale. It was pointed out by the assessee that in the despatch note Nos. 508, 509 and 518 the word “invoice” was struck down and “pro forma invoice” was written. The assessing authority observed that in the light of the correspondence and facts of the case the transaction is an inter-State sale. It is contended that Sri Mohan Kamath has only given despatch instruction to stock transfer and have not placed the order for inter-State sale. The appellate authority beside considering other factors have taken note of the letter dated October 8, 1985 from which it was found that the documents were retired through bank and a request was made only to send “F” form and sale patti. The levy of tax was set aside considering the discounting of pro forma invoice or despatch note as consistent with consignment agent transactions. Decisions given in [1968] 22 STC 298 (AP) (Hyderabad Chemicals and Fertilizers Ltd. v. State of Andhra Pradesh), [1975] 35 STC 452 (Bom) (Commissioner of Sales Tax v. Rowers Chemicals Pvt. Ltd.), [1986] 61 STC 341 (Mad.) (State of Tamil Nadu v. State Trading Corporation of India Ltd.) and [1968] 21 STC 312 (SC) (Sri Tirumala Venkateswara Timber and Bamboo Firm v. Commercial Tax Officer) were referred. The revising authority under Section 22-A found that the order passed is erroneous and prejudicial to the interest of revenue and set aside the appellate order. Learned counsel for the appellant submitted that in order to constitute an inter-State sale, there must be agreement and movement of goods in pursuance of such agreement from one State to another and then only it could be considered to be an inter-State transaction.
3. Reviewing the decision in State of Bombay v. United Motors (India) Ltd. , in Bengal Immunity Company Limited v. State of Bihar , it was held that the State Legislature has no power to levy tax in respect of inter-State sale. This decision gave birth to the Central Sales Tax Act. Section 3 deals with inter-State sales and Section 4 refers to the sales or purchases’ of goods which are said to take place outside the State and Section 5 deals with sales or purchase of goods which said to take place in the course of import or export. Provisions of Section 3 are overriding. In order to determine a sale that it is an inter-State sale, it was considered that there must be movement of goods from one State to another under the contract of sale, [Endupuri Narasimham and Son v. State of Orissa ].
4. Law is settled that in order to consider a transaction an inter-State sale there must be movement of goods from one State to another under a contract of sale. The dispute arises in cases where according to the assessee the transaction is sale outside the State and the tax authorities considered it to be an inter-State sale.
5. A transaction which is not liable to tax under Section 3 of the Central Sales Tax Act, 1956, i.e, it is not an inter-State sale in the following circumstances :
1. Transfer of the goods is to the agent or branch for sale.
2. Where the movement of the goods is independent of the contract.
6. Sale to an exporter of goods with a view to export was considered as not exempt in State of Mysore v. Mysore Spinning and Manufacturing Co., Ltd. .
7. In the following decision controversy as to whether it is an inter-State sale or not is examined by various High Courts and apex Court.
Principles of inter-State sale :
In Ben Grom Nilgiri Plantations Co., Coonoor v. Sales Tax Officer , it was held that sale in the course of export predicates a connection between the sale and export, the two activities being so integrated that the connection between the two cannot be voluntarily interrupted, without a breach of the contract or the compulsion arising from the nature of the transaction. In this case it was found that the sale of tea was made to the local agents of foreign buyers who have subsequently exported. The transaction was found not exempt under Article 286(1)(b) or Section 5 of the C.S.T. Act.
In Bharat Heavy Electricals Limited v. Union of India , while interpreting the provisions of Sections 3(a), and Section 9 of the Central Sales Tax Act, it was observed that, whether the sale is an inter-State sale or not has to be decided with reference to the provisions of Section 3 alone and Section 4 or 5 are not relevant. The decisions given in the case of Tata Iron and Steel Co. Limited v. S.R, Sarkar , Manganese Ore (India) Ltd. v. Regional Assistant Commissioner of Sales Tax and Union of India v. K.G. Khosla and Co. Ltd, , were taken into consideration. It is observed in Bharat Heavy Electricals Limited v. Union of India thus :
“If a dispute arises in which State is the tax lawfully leviable, the authorities under the Act have got to decide it. If, in a given case, an assessee says that the particular transaction which is sought to be taxed in State ‘A’ has already been taxed in State ‘B’ nothing prevents him from impleading the State ‘B’ in proceedings in State ‘A’ and have the matter decided in the presence of all parties. It must be remembered that while acting under the Central Sales Tax Act, the State machinery acts as the machinery of the Central Government and not as the machinery of the State Government ; in law, it is as if it belongs to Central Government. This view of ours gets reinforced if one keeps the provisions in Section 8(2A) of the Central Sales Tax Act in view.”
In Cement Marketing Co, India (Private) Ltd. v. State of Mysore , the goods were despatched from factories outside the State at buyer’s risk from the time delivery was made by the factory to the carriers and the railway receipt was obtained for the goods. The delivery was made at Mysore. It was considered to be an inter-State sale because under the contract of sale there was transport of the goods from outside the State of Mysore into the State of Mysore and the transactions themselves involved movement of goods across the border.
In Commissioner of Sales Tax, M.P., Indore v. Allwyn Cooper [1970] 25 STC 26 (SC), there were four contracts to supply manganese ore in the performance of each one of the contract necessarily involved the movement of the goods from one State to another State as the contract made the necessity of the movement of the goods from one State to another State.
In F.K. Haseeb and Co. v. State of Madras [1973] 31 STC 213 (Mad.), it was held that to constitute an inter-State sale, the basic requirement is that there must be a prior contract of sale before the goods moved from one State to another.
In Oil India Ltd. v. Superintendent of Taxes , it was observed that the movement of crude oil from the State of Assam to the State of Bihar was an incident of the contract of sale. No matter in which State the property in the goods passes, a sale which occasions “movement of goods from one State to another is a sale in the course of inter-State trade”. The inter-State movement must be the result of a covenant, express or implied, in the contract of sale or an incident of the contract. It is not necessary that the sale must precede the inter-State movement in order that the sale may be deemed to have occasioned such movement. It is also not necessary for a sale to be deemed to have taken place in the course of inter-State trade or commerce, that the covenant regarding inter-State movement must be specified in the contract itself. It would be enough if the movement was in pursuance of and incidental to the contract of sale.
In Balabhagas Hulaschand v. State of Orissa three illustrations were given, which are as under :
“(i) that there is an agreement to sell which contains a stipulation express or implied regarding the movement of the goods from one State to another ;
(ii) that in pursuance of the said contract the goods in fact moved from one State to another ; and
(iii) that ultimately a concluded sale takes place in the State where the goods are sent which must be different from the State from which the goods move.”
In Oil and Natural Gas Commission v. State of Bihar , it was observed :
“…………the delivery may be in Assam or in Bihar at Barauni but the movement of goods is the result of contract and as an incident to the agreement between the Commission and the Corporation. The State of Assam has lawfully levied the Central sales tax on the petitioner.”
In the case of English Electric Company of India Ltd. v. Deputy Commercial Tax Officer , it was observed that when a branch of a company forwards a buyer’s order to the principal factory of the company and instructs them to despatch the goods direct to the buyer and the goods are sent to the buyer under those instructions it would not be a sale between the factory and its branch. If there is a conceivable link between the movement of the goods and the buyer’s contract, and if in the course of inter-State movement the goods move only to reach the buyer in satisfaction of his contract of purchase and such a nexus is otherwise inexplicable, then the sale or purchase of the specific or ascertained goods ought to be deemed to have taken place in the course of inter-State trade or commerce as such a sale or purchase occasioned the movement of the goods from one State to another. The presence of an intermediary such as the seller’s own representative or branch office, who initiated the contract may not make the matter different.
In Union of India v. K.G. Khosla and Co. Ltd. , it was found that the manufacturing and production of goods were according to the requirement of the purchasers. It was found that it is not a case where the goods are manufactured in the general course of business for being sold as and when offers are received by the manufacturers for their purchase. Although contracts of sale do not require or provide that the goods should be moved from Faridabad to Delhi the movement of goods occasioned is a result or incident of the contract of sale in respect of the goods conforming to agreed specification and hence inter-State.
In Indian Oil Corporation Ltd. v. Union of India , sale of naphtha by seller having refinery in Bihar laying pipeline to Kanpur in U.P. was considered to be an inter-State sale. It was observed that it is now well-settled by a series of decisions of this Court that a sale shall be an inter-State sale under Section 3(a) if there is a contract of sale preceding the movement of goods from one State to another and the movement is the result of a covenant under the contract of sale or is an incident of that contract ; in order that a sale may be regarded as an inter-State sale it is immaterial whether the property in the goods passes in one State or another.
In South India Viscose Ltd. v. State of Tamil Nadu [1981] 48 STC 332 (SC), it was observed that in order to constitute an inter-State sale as defined in Section 3(a) of the Act, two, factors should co-exist (i) a sale of goods and (ii) movement of goods from one State to another under the contract of sale. If there is a conceivable link between a contract of sale and the movement of goods from one State to the other in order to discharge the obligation under the contract of sale, the interposition of an agent of the seller who may temporarily intercept the movement ought not to alter the inter-State character of the sale.
If the goods are stated to be supplied within the State without any stipulation to move the goods outside the State it cannot be considered to be an inter-State sale irrespective of the fact that C form was issued by the purchaser.–Delhi Cloth and General Mills Co. Ltd. v. Commissioner of Sales Tax [1981] 48 STC 351 (Delhi).
In Sahney Steel and Press Works Ltd. v. Commercial Tax Officer , it was observed that the manufacture of goods at the Hyderabad factory and their movement thereafter from Hyderabad to branch office outside the State was an incident of the contract entered into with the buyer, for it was intended that the same goods should be delivered by the branch office to the buyer. There was no break in the movement of goods.
Auction sale of diamonds was effected at Madras by National Mineral Development Corporation to buyers from Bombay. Successful bidders were to pay security deposit of 25 per cent of price–Delivery was at Bombay and payments settled at Bombay and sale invoice and delivery challan handed over at Bombay. It was held that movement of goods occasioned by sale although property in goods passed earlier on fall of hammer. Sales were held not liable to tax under Tamil Nadu General Sales Tax Act. Sales are inter-State sales and taxable under Central Sales Tax Act.–National Mineral Development Corporation Ltd. v. State of Tamil Nadu [1987] 67 STC 1 (Mad.).
There can be an inter-State sale between two dealers of the same State. A manufacturing company was selling the goods under agreement with the trading company and delivering the goods to the trading company For booking station for which the trading company obtained orders from out of the State buyers for which directions were given to the manufacturing company to book the goods by railway of specific quantities to destination outside the State. Though there was no contract between the manufacturing company with the outside buyer, it was considered to be an inter-State sale in the State of Tamil Nadu v. Dharangadhara Trading Co. Ltd. .
In Co-operative Sugars (Chittur) Ltd. v. State of Tamil Nadu , it was observed :
“The appellant was permitted to purchase sugarcane in Coimbatore and Pollachi taluks only with a view to and exclusively for the purpose of transporting to its factory in Kerala. Whatever was purchased was transported to the appellant’s factory in Kerala. It must, therefore, be held that this is a case where the movement of goods was occasioned by sale by the farmers or by the purchase by the appellant, whichever way one looks at it. The movement of the sugarcane from Tamil Nadu to Kerala is the incident of, and is inextricably connected with the sale/purchase. The purchase and transport are but parts of one transaction. They cannot be dissociated in this case. There is no break between the purchase and the movement of the goods to another State, viz., Kerala. It is immaterial, in such a case whether the sale/purchase takes place within Tamil Nadu or within Kerala. So long as the movement of goods is an incident of the sale/purchase it amounts to an inter-State sale/purchase. It is not also necessary that the contract of sale must expressly provide for movement of goods. It is sufficient if the movement of goods is implicit in the sale.”
Branch transfer :
IDL Chemicals v. State of Orissa (1987) 23 STL 72 (Trib) (Orissa) [FB] it was held that since the goods were of general nature and were not supplied for specification or design, the transactions do not amount to inter-State sales.
In the case of Tata Engineering and Locomotive Co. Ltd. v. Assistant Commissioner of Commercial Taxes , the assessee manufacturing trucks and buses in Jamshedpur in the State of Bihar, transferred the vehicles to stock-yards in other States. Dealers were required to mail to the company on the 15th of each month a firm order for purchases to be effected during the next succeeding month and their estimated requirement for two months following the next succeeding month. Stock available in stock-yards was then distributed to the dealers for which allocation letters were issued each month by sales office. The transactions was considered to be not inter-State sales. There were many instances where the vehicles had been actually delivered from the stock-yards prior to the issue of the allocation letter. It was held that the procedure followed by the assessee together with proved absence of any firm orders, indicated that the allocation letters and statements furnished by the dealers did not themselves bring about transaction of sale within the meaning of Section 2(g) of the Act. The completion of the sales to the dealers did not take place at the works at Jamshedpur, appropriation of the vehicles was done at the stock-yards and it was open to the appellant till then to allot any vehicle to any purchaser and to transfer a vehicle from one stock-yard to another. It could not therefore be said that the movement of vehicles from the works to the stock-yards was occasioned by any covenant or incident of the contract of sale. Even assuming that any firm orders had been received by the appellant they could not be regarded as anything but mere offers.
In Bhoruka Steal v. State of Karnataka S.T.A. No. 37 of 1977 dated February 4, 1981 held that by mere fact that the sales were effected in other State without unloading the goods from the lorries and delivering the goods on the same day to those who have purchased, by same lorries cannot be inferred as inter-State sales. Movement comes to an end when the lorry reaches the branch in the other State. The branch is free to sell the goods to customers without unloading.
In Radhakrishna Mills Ltd. v. State of Tamil Nadu [1973] 32 STC 166 (Mad.) it was held that there was no movement against definite contract. Branch was free in supply of goods to any of the pending contracts.
In Kelvinator of India Ltd. v. State of Haryana , it was considered that a sale in the course of inter-State trade has three essentials : (1) there must be a sale, (2) the goods must actually be moved from one State to another, and (3) the sale and movement of the goods must be part of the same transaction.
In Bhoorey Khan Glass Bangle Factory v. Commissioner, Sales Tax, U.P., Lucknow [1974] 34 STC 332 (All.), it was held that in the absence of evidence with regard to the very nature of contract contemplating the movement of goods from one State to other, it cannot be said that the movement occasioned by the transaction of sale.
In State of Tamil Nadu v. Cement Distributors (P) Ltd. , the assessee was an agent of the State Trading Corporation under Cement Control Order. Cement was authorised to be sold to the persons mentioned in the authorisation letter. It was observed that apparently there was no movement of goods by the respondent-company as a result of a contract of sale between the respondent and the buyer at Calcutta. The shipment was made without any reference to any buyer. The movement of goods from Madras to Calcutta did not take place as a result of any contract of sale, but in pursuance of instruction contained in authorisation for transfer of stocks from Madras to Calcutta. The transactions were not inter-State sales liable to tax under the Central Sales Tax Act. The movement of goods from one State to another without any of the elements of “sale” within the meaning of the Central Sales Tax Act cannot be subject to tax. The shipment was of stocks of cement belonging to the State Trading Corporation from one place to another. There was shortage of supply of cement at Calcutta. The State Trading Corporation moved stocks from Madras to Calcutta. The area of need and the availability of stocks of cement were known to the State Trading Corporation. The transactions could not be subjected to Central sales tax.
Punjab and Haryana High Court in the case of South Punjab Electricity Corporation Ltd. v. State of Haryana [1976] 37 STC 35, held that movement of goods from factory at Rohtak to Delhi branch was not as a result of sale as the goods were not appropriate till they reached Delhi branch.
In Deputy Commissioner (Commercial Taxes), Tiruchirappalli v. Pudukkottai Textiles Limited [1976] 37 STC 544 (Mad.), it was held that since there was no evidence to show that the goods, in. order to fulfil the contract should be moved from outside the State. The transactions cannot be held as inter-State sales.
In Flowmore Private Limited v. Commissioner of Sales Tax [1983] 53 STC 88 (All.), assessee had a factory at Ghaziabad. Head office at Delhi entered into contract for sale for supply of flowmore pump sets. The pumps were manufactured at Ghaziabad and moved to Delhi. It was held that the goods were assembled at Delhi and the title passed to the buyer in Delhi. The transactions were held not liable to Central sales tax.
In State of Tamil Nadu v. Hercules Rubber Co. [1983] 54 STC 85 (Mad.), assessee had put marking on the consignment which was sent by lorry in the name of purchaser. The goods were sent from head office to branch office and branch office issued invoices to the purchaser and handed over the goods and the lorry receipts which were in their possession. It was considered that there was no direct link established between the assessee and the buyers in other State.
In the case of Indian Duplicators Ltd. v. State of Tamil Nadu [1984] 57 STC 263 (Mad.), the assessee manufactured duplicators at Madras and despatched them to Hyderabad branch which in turn supplied the goods to the local buyers against orders placed by them. The goods had the mark of Andhra Pradesh buyer’s name. It was held that there was no establishment of any direct link or nexus between the assessee and the movement of goods for supply to the Andhra Pradesh buyer.
In Delhi Iron & Steel Co. Ltd. v. Commissioner of Sales Tax, U.P. [1989] 72 STC 294 (All.) it was held that the mere fact that the assessee did not have any godown in Delhi and the sales have been effected of the same in Delhi, can hardly be a ground for the department to reject the claim of branch transfers.
In L&T Ltd. v. State of Karnataka S.T.A. Nos. 302 to 401 of 1993 and 116 of 1994, Karnataka High Court held that the decisions of the Punjab and Haryana High Court in [1990] 77 STC 211 (Haryana Iron and Steel Rolling Mills v. State of Haryana), [1989] 75 STC 428 (Mehta Group of Industries v. State of Haryana) and [1990] 77 STC 424 (Electric Construction and Equipment Co. Ltd. v. State of Haryana) cannot be applied blindly without scrutiny of facts.
In Gromore Chemicals Private Limited v. State of Andhra Pradesh , it was held that since the branch had not committed itself to the requirement of the purchaser the contract was not concluded. Hence movement of goods from one State to another was on account of branch transfer only.
In Kerala Small Industries Development Corporation Ltd. v. Commercial Tax Officer, Second Circle, Mangalore , it was held that supply of cement from Mangalore to customers in Kerala did not move as a result of covenant in contract. Transfer of goods were held to be mere transport of goods.
In State of Andhra Pradesh v. Thungabhadra Industries Ltd. [1992] 86 STC 235, Andhra Pradesh High Court held that the appropriation of goods against a particular contract takes place only at the depot, when the invoice is raised after receipt of the payment as the goods moved from factory in one State and depot in other State in truck loads at frequent intervals and the goods were unloaded in the depot and entered into stock register.
In State of Tamil Nadu v. Mount Mechanical Works Pvt. Ltd. [1992] 87 STC 260, the Madras High Court held that,
(1) The contract between the buyer and the branch in Bangalore did not contemplate any movement of goods from Tamil Nadu to Karnataka.
(2) Goods were not directly delivered to the purchasers, but were delivered by the branch after taking to stock.
(3) The ownership in the goods vested with the Bangalore branch till the goods were delivered to the purchasers and nothing prevented the Bangalore branch to divert the goods.
In Rallies India Limited v. State of Tamil Nadu [1994] 92 STC 325 (Mad.), it was held that since the goods were transferred regularly from factory at Ooty to Cochin office irrespective of purchase orders and since stocks were available at all times at Cochin office and goods were stored in Cochin office, the movement of goods from one State to another was not occasioned by sale and amounted to stock transfers.
In State of Tamil Nadu v. K.V. Baby & Co. [1994] 95 STC 39, Madras High Court held that there is no material on record to support the claim of the assessing authority in treating the stock transfers as inter-State sales, whereas it is only the assumption. The facts are that,–
(1) The assessee transported goods at own risk and cost from Tamil Nadu to Kerala.
(2) The assessee after ascertaining the local market conditions at Kerala, sold the goods to different persons against cash payments.
(3) The railway receipts which were on record were not endorsed in the name of the persons in Kerala.
In Commissioner, Sales Tax, U.P., Lucknow v. Modi Pon Limited [1995] 96 STC 394, the Allahabad High Court held that the goods transferred to godowns outside the State in bulk where they were not in pursuance of contract were only branch transfers.
Local transfer :
In Moti & Co. v. State of Tamil Nadu [1999] 113 STC 53 (Mad.), after purchasing the tea in auction at Coonoor (the sale was ex-godown at Coonoor), it was sent outside the State through a broker. It was held that the property in goods was intended to pass to buyers at Coonoor and it was open to the buyer to deal with the goods in any manner chosen by the buyer after it had acquired title to the goods. Anything done by the seller thereafter at the instance of the buyer was considered to be an act of service and even describing himself as consignor was not considered an inseverable link between the movement of goods and the sale.
8. From the various decisions cited above, following principle emerges :
(1) That there must be movement of goods from one State to another and it may be under a contract of sale or under a covenant or incident of that contract.
(2) If the goods have moved from one State to another by the buyer after taking delivery from the seller in the State, then it could not be considered to be an inter-State sale.
(3) The goods may be sent to the branch or agent for sale. If such despatch of goods is without reference to any contract, then the transaction cannot be considered to be an inter-State sale.
(4) If the branch manager or agent has the discretion to give particular quantity it cannot be said that there is a link between movement of goods and sale.
(5) In a particular State there may be one or two buyers who are purchasing goods from the branch, so long as the discretion remains to give a particular quantity, the transaction would not be considered to be an inter-State sale.
(6) If the goods are sent to the agent for sale then it cannot be considered to be an inter-State sale. In such a situation it has to be seen that it should not be a camouflage of account. If the sale proceeds are the same for which the hundi has been drawn in advance, the assessing authority is justified in considering that an agreement was already entered into on the basis of which the sale has been effected as in the present case.
9. Beside that there was further intervention of any agent is not customary. If the goods are sent on the instruction of a third party then, the inference which has been drawn cannot be considered to be arbitrary. It was found as a fact that the goods were sent on the instruction of the third party and therefore the inference which was drawn that it was an inter-State sale does not require any interference.
10. The contention which has been raised that the order of the appellate authority is not erroneous or prejudicial to the interest of the revenue has no substance. The appellate authority has to decide the appeal in accordance with law ; if any view has been taken which is not in accordance with law the power of revision under Section 22 can be exercised. The effect of the letters referred by the assessing authority were not properly considered by the appellate authority. It was not disputed by the assessee that the nature of transaction is different and therefore the effect of other transaction be examined. As observed above, the transaction which were inter-State sales were shown as transfers and were at the instance of Mahalsa Enterprises, Bangalore. Submission of “F” form is not a conclusive evidence for which the assessing authority has the jurisdiction to examine the matter and come to its own conclusion and if it is found that the transaction is not a branch transfer or transfer to the agent, tax in accordance with law could be levied.
Appeals are accordingly, dismissed.