Case Law Details
Toyota Kirloskar Motor Pvt. Ltd. Vs State of Karnataka (Karnataka High Court)
Brief facts of the case are, assessee imported automobiles and made ‘High Sea Sales’ of 12 vehicles. It has claimed exemption under Section 5(2) of the Central Sales Tax Act, 1956 (‘CST Act’ for short) for the years 2009-10 and 2010-11. Before the Assessing Authority, the assessee produced various documents. The exemption was denied by the Assessing Officer on the premise that Bill of Lading was not endorsed by the assessee. The First Appellate Authority, confirmed the said order. On further appeal, the KAT limited the relief in respect of turnover of Rs.1,65,32,500/- as against Rs.18,16,99,863/-.
Settled position of law is, the Bill of Lading is only one of the ways to transfer the title and not the only way. It can be done either by handing over the Bill of Lading itself to the customers before the goods pass the customs barrier of India.
Admittedly, the appeal before the KAT was filed by the assessee. The question for consideration is, whether exemption could be denied for want of assessee’s endorsement on the Bill of Lading?
In our view, the KAT has rightly noted the correct position of law that Bill of lading is not the only way of transfer of title and it can also be done by even handing over the Bill of Lading to the customers. Further, on consideration of the Intelligence Report, KAT has satisfied itself that documents were available in respect of turnover of Rs.1,65,32,500/-. Denial of the exemption in respect of turnover of Rs.16,51,67,363/- being the remaining portion of the turnover was not the subject matter for consideration before the KAT. In view of the settled position of law, the order passed by the KAT is perverse and unsustainable in law.
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