Allahabad High Court
The Commissioner, Commercial Tax U.P. ... vs S/S Jml Marketing Pvt. Ltd. on 25 November, 2020
Author: Pankaj Bhatia
Bench: Pankaj Bhatia
HIGH COURT OF JUDICATURE AT ALLAHABAD ?Court No. - 38 Case :- SALES/TRADE TAX REVISION No. - 118 of 2020 Revisionist :- The Commissioner, Commercial Tax U.P. Lucknow Opposite Party :- S/S Jml Marketing Pvt. Ltd. Counsel for Revisionist :- Bipin Kumar Pandey Hon'ble Pankaj Bhatia,J.
Heard Sri B.K. Pandey, learned counsel for the Department and Sri Subham Agarwal, learned counsel for the respondents.
The present revision has been filed challenging the judgment and order dated 7.7.2020 passed by the Tax Tribunal in respect of the respondents for the assessment year 2014-15 under the U.P. Value Added Tax Act.
It was alleged that respondent was carrying the business of purchase and sale of edible oil. Initially assessment of the dealer was accepted under the deemed scheme vide order dated 9.7.2016, however, on the basis of a report received from the office of the Joint Commissioner Tax Audit dated 9.4.2017 to the effect that no actual sale has taken place and only the tax invoices have been procured to claim benefits of Input Tax Credit on illegal transaction, the Assessing Authority proceeded under Section 29(1) of the VAT Act and recalled the order dated 9.7.2016 and on the basis of the fresh assessment, created a demand of Rs. 6,67,30,781/- under Section 29(1) of the Act. It is stated that on the basis of an application filed by the dealer under Section 32, the Assessing Authority re-opened the assessment and rejected the claim of the dealer and assessed amount of tax recoverable from the dealer at Rs. 6,35,44,426/-. The whole exercise was done on the basis of the Tax Audit report.
Aggrieved against the said order, the assessee, the respondent herein, filed a First Appeal No. ALL1/0138/2020. During the course of the hearing of the said appeal, the dealer produced evidences with regard to the transportation of goods and accepting the said evidence the Appellate Authority allowed the appeal merely on two grounds firstly that the initiation of assessment solely on the basis of Tax Audit report without recording "reasons to believe" was bad in law and secondly, the evidence given by the assessee was accepted. Consequently, the appeal filed by the respondent was allowed vide order dated 26.9.2020.
Aggrieved against the said order, the revisionist preferred an appeal before the Commercial Tax Tribunal. The Commercial Tax Tribunal after hearing the parties at length has held that no "reasons to believe" were recorded and the entire exercise has been carried out only on the basis of audit report and in view of the specific evidence given by the respondent, there was no merit in the appeal and, accordingly, the appeal stood dismissed. The Tribunal also recorded that insofar as the revenue loss was concerned, the entire exercise was revenue neutral inasmuch the dealer had paid the tax, which is payable in respect of the purchase from unregistered dealers.
Aggrieved against the said judgment dated 7.7.2020, the present revision has been filed.
Sri B.K. Pandey, counsel for the Department has argued that in the Tax Audit report, it was revealed that certain truck numbers, through whom it was alleged that the purchases were made, were not actually the number of the trucks as verified from the App of the Ministry of the Transport and thus on the said basis, the entire proceedings were initiated. It is also argued that the first Appellate Authority committed illegality in accepting the evidence at the appellate stage.
I am not impressed with the said submission for the sole reason that there is no contention as to why and how the proceedings could be initiated without even recording any "reasons to believe" merely relying upon the Tax Audit report. Even otherwise the findings recorded in the Tax Audit report had to be controverted by the assessee, which the assessee did by filing the relevant affidavits and documents before the first Appellate Authority and thus no fault could be found with the said procedure. Even otherwise as the Tribunal has recorded that entire exercise was revenue neutral and there is no ground to suggest that the said finding is any way perverse or erroneous, no question of law, much less a substantial question of law arises for consideration by this Court.
Accordingly, the revision stands dismissed.
Order Date :- 25.11.2020 S. Rahman