Petitioner Ambica Steels LTD. filed writ petitions challenging the circular dated November 28, 2005 issued by the Commissioner of Trade Tax mentioning that under section 6A of the Central Sales Tax Act, 1956 Form F is required to be filed in respect of all transfer of goods which are otherwise than by way of sale including goods sent or received for job work & returned of it.

U.P. High Court dismissing the petition in (2008) 12 VST 216 held that, section 6 of the Central Sales Tax Act, 1956 is the charging section creating liability to tax on inter-State sales and by reason of section 6A(2) a legal fiction has been created for the purpose of the Act that transaction has occasioned otherwise than as a result of sale. Section 6A puts the burden of proof on the person claiming transfer of goods otherwise than by way of sale and not liable to tax under the Central Act. The burden would be on dealer to show that movement of the goods had been occasioned not by reason of any transaction involving any sale of goods but by reason of transfer of such goods to any other place of business or to the agent or principal, as the case may be, for which the dealer is required to furnish prescribed declaration form. If the dealer fails to furnish such declaration, by reason of legal fiction, such movement of goods would be deemed for all purposes of the Act to have been occasioned as a result of sale. The submission that the transactions, where the goods are sent for job work or received for doing job work, do not amount to sale would depend upon the contract entered into between the parties and would be the subject-matter of examination by the assessing authority. Even otherwise, under section 2(g)(ii) of the Central Act, transfer of goods used in execution of works contract is treated to be a sale. If the petitioner claims that it is not liable to tax on transfer of goods from U. P. to a place outside State then it would have to discharge the burden placed upon it under section 6A by filing declaration in form F. It would be immaterial whether the person to whom the goods are sent for or received after job work is a bailee. The requirement to file declaration in form F is applicable in cases of even goods sent for job work and returned thereof. Thus the petitions lack merit.

Being aggrieved buy the above decision the petitioner filed Civil Appeal before the Hon’ble Supreme Court, where also it has been rejected – hence declaration in Form F has become mandatory. If you are dealing in inter State Job work than obtain such declaration without any delay.