‘The transport/supply does not fall within the ambit of transfer of goods as defined in “sale” – ruled the Tripura High Court bench consisted of Chief Justice (Acting) T. Amarnadh Goud and Justice Arindam Lodh.
Brief facts are that the petitioner is carrying the business of distribution of Liquid Petroleum Gas (LPG) as well as transportation of LPG and LPG cylinders.
On participation in a tender, invited by the Indian Oil Corporation Limited (IOCL),successful in the bid for grant of licences for transportation of LPG and LPG cylinders for various destinations.
Further, the IOCL had issued three separate work orders for transportation of LPG and LPG cylinders for different places.
But, during the process of execution of those work orders, the Superintendent of State Tax initiated an assessment proceeding against the petitioner and passed an Order of Assessment levying with a liability to pay tax of to the petitioner for the A.Y. 2015-2016 & 2016-2017 and further issued two demand notices, for payment of the aforesaid amounts as value added tax, interest and penalty.
K. Deb, Addl. G.A. spoke on behalf of the respondents and stated that according to the provisions of the contract between the petitioner and IOCL, the latter has overall control over the truck transporting LPG gas and an LPG cylinder, even though the petitioner/dealer provides the driver and crew.
Hence, the State of Tripura has jurisdiction to levy tax, in connection with such agreements. In support of his submission, they placed reliance upon a decision of the Gauhati High Court in Dipak Nath Vrs. Oil & Natural Gas Corporation Ltd. & Ors., reported in (2010) 2 GLR 496.
Argued further that since the written agreements in this matter were signed in Guwahati, Assam, the sale’s situs would also be there. As a result, the taxing authorities in Tripura would not have any authority to impose any taxes in connection with this arrangement.
The bench observed that when a transaction has taken place in Assam, the respondent authorities cannot have any jurisdiction over Interstate.
The bench further quashed and set aside the Assessment Order and two Demand Notices on the grounds of jurisdiction, the right to sell the goods, and the location of the contract’s execution because, given that the sale was conducted in Guwahati, the State of Tripura lacks jurisdiction over the petitioner with respect to the imposition of tax by the respondents.
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