Allahabad High Court
S/S Bhatiya Traders vs The Commissioner Commercial Tax U.P. ... on 17 September, 2019
Author: Saumitra Dayal Singh
Bench: Saumitra Dayal Singh
HIGH COURT OF JUDICATURE AT ALLAHABAD ?Court No. - 59 Case :- SALES/TRADE TAX REVISION No. - 180 of 2009 Revisionist :- S/S Bhatiya Traders Opposite Party :- The Commissioner Commercial Tax U.P. Lucknow Counsel for Revisionist :- Aloke Kumar Counsel for Opposite Party :- C.S.C. Hon'ble Saumitra Dayal Singh,J.
1. Heard Shri Aloke Kumar, learned counsel for the assesse and Shri A.C. Tripathi, learned Standing Counsel for the revenue.
2. The present revision has been filed by the assessee against the order of the Commercial Tax Tribunal, Jhansi, dated 12.01.2009 arising from Second Appeal No. 250 of 2000 for A.Y. 1994-95 (U.P.) filed by the assessee. By that order, the Tribunal has dismissed the appeal filed by the assessee and thus confirmed the demand of tax on alleged first purchase of foograins attributed to the assessee.
3. The revision has been pressed on the following question of law:
"A) Whether without questioning the genuineness of Form 3-C(1) or without pointing out any defect in the same, the Assessing Authority can be permitted to reject the claim of exemption?"
4. Undisputedly, during the assessment year in question, the assessee was engaged in trading in foodgrains. The liability of tax on purchase of foodgrains existed on the first purchase by registered dealer, inside the State of U.P.
5. Again, undisputedly, during the assessment proceedings, the assessee filed two number of Form III-C(1), issued under the U.P. Trade Tax Rules, 1948 (hereinafter referred to as the 'Rules') bearing numbers (i) 105297 for purchase of various foodgrains from M/s. Shashi Kant Anand Kumar, Poonch of value Rs. 63,72,904/- and (ii) 105295 for purchase of various foodgrains for value Rs. 74,80293/-.
6. Thus, the assessee claimed to have purchased foodgrains from another registered dealer of value Rs. 1,38,53,197/-. Inasmuch as the seller M/s. Shashi Kant Anand Kumar, Poonch was a registered dealer who had issued Form III-C(1) to the assessee, no tax liability existed on the assessee.
7. However, the assessing officer rejected the claim made by the assessee on the reasoning that such sales had not been disclosed in the regular books of accounts of the assessee or the monthly returns filed by him. That order has been sustained by the Tribunal by recording additional reasoning to the effect that the original 6R and 9R receipts under the Mandi Adhiniyam were never produced by the assessee.
8. While, such reasoning has been adopted by the revenue authorities as also the Tribunal, no finding has been recorded to disbelieve the genuineness of the two Forms III-C(1) produced by the assessee and no finding has been recorded to establish that there was any collusion or fraud practised by the assessee with participation of M/s. Shashi Kant Anand Kumar, Poonch, the selling dealer.
9. Further no enquiry appears to have been made by the assessing officer or any of the revenue authorities from the said selling dealer as to the correctness of the claim made by the assessee that the two Forms III-C(1) had been issued to it by the said selling dealer.
10. While the contention advanced by learned counsel for the assessee, that the original 6R and 9R receipts are available with the assessee and therefore the same are wholly verified, cannot be accepted or considered at this stage in absence of such records having been produced to the assessing officer, it remains undisputed to the revenue that there is nothing to doubt the genuineness of the two Forms III-C(1) relied upon by the assessee or the facts mentioned therein. Merely because the regular books of accounts had not been maintained by the assessee and that no books of accounts had been produced in the assessment proceedings, may remain a ground for rejection of books of accounts and estimation of turnover on best judgment assessment basis. However, even while making the best judgment assessment, the revenue authorities would remain bound to give benefit to the assessee, of valid statutory Forms such as Forms III-C(1).
11. Non-production of the books results in estimation of total turnover at the hands of the assessee. However, its claim of having made purchase of part of the goods from other registered dealers does not hinge on the maintenance of the books of accounts but on the validity or otherwise of Form III-C(1). It is so because such Forms had been issued not by the dealer being assessed but by the other registered dealer who had no concern with the maintenance or non-maintenance of the books of accounts by his purchasing dealer.
12. Therefore, once the assessee had produced Forms III-C(1) in original, it was for the revenue authorities to have made proper enquiry and verification from the selling dealer and his assessing authority as to the genuineness and correctness of such Forms. Perusal of the impugned orders reveals that no enquiry was made at any stage. The claim of the assessee has been rejected on presumptions and conjectures and not on any cogent material.
13. In view of the above, no purpose would be served in now remitting the matter to the fact-finding authority, inasmuch as the assessment year in question is 1994-95 and more than 24 years have passed since the end of that assessment year.
14. Accordingly, it appears that, of the total turnover estimated on best judgment at Rs. 1,90,00,000/- crores, the assessee would remain entitled to the benefit of Rs. 1,38,53,197/- for which Form III-C(1) had been produced and with respect to which no real defect has been found by any of the authorities.
15. The question of law is answered in the negative, i.e. in favour of the assessee and against the revenue. The revision is allowed.
Order Date :- 17.9.2019 AHA