M/S D.N Electronics vs M/S Shivam Enterprises on 25 February, 2022
33. I have perused the judgement reported as M. Framrose And
Company (supra). That judgement was in the context of liability
to pay sales tax under Bombay Sales Tax Act, 1959. That was not
a dispute between a buyer and a seller but between an assessee of
sales tax and the state. That judgement was in the context of the
issue as to whether the return of the defective goods by the
purchaser to seller constituted a sale within the meaning of
Bombay Sale Tax Act, 1959. In that case the goods were actually
returned by the buyer to the seller on being found defective and
accepted by the seller. In that case Hon'ble Bombay High Court
was interpreting a revenue statute in the context of liability of an
assessee to pay tax. The judgement is of no help to the defendant
in facts of this case. In this case, the defendant admittedly had
actually utilized the goods for the exhibitions at Noida and other
places. May be, that it was not able to locate the prospective
buyers for these goods for some reason, but such a risk is
inherent in all business adventures. The defendant was not having
any right to return the goods to the plaintiff at any time within six
months as is sought to be contended by the defendant under
Section 8(1) (d) of The Delhi Value Added Tax Act. Such a
C.S. (Comm.) 04/2020 M/s D.N. Electronics vs. M/s Shivam Enterprises page 18 of 21
period cannot be considered as reasonable under Section 42 of
the Sale of Goods Act, 1930 in the facts and circumstances of this
case especially after the defendant utilized the goods in
exhibitions. DW1 in his cross examination stated that the goods
were exhibited in exhibitions at Noida, Delhi, Lucknow, Gurgaon
and at other places.