JUDGMENT Rajes Kumar, J.
1. Present revision under Section 11 of U.P. Trade Tax Act (hereinafter referred to as "Act") is directed against the order of Tribunal dated 18th January, 2006 for the assessment year 2000-01.
2. The following questions have been raised in the present revision:
(A) Whether on the facts and in the circumstances of the case, the Trade Tax Tribunal was legally justified in upholding the rejection of account books and in passing a best judgment assessment merely on the ground of difference in the book version and return version, particularly when the book version was on the higher side and no specific material of suppression of sales was on record?
(B) Whether on the facts and in the circumstances of the case, the Trade Tax Tribunal was legally justified in determining the turnover of various goods without assigning any basis for determination thereof?
(C) Whether on the facts and in the circumstances of the case, the Trade Tax Tribunal was legally justified in determining the turnover of "Flavoured Milk" and imposing tax thereon when the Flavoured Milk is basically milk and is exempted from tax as per Notification No. ST-11 7038/X/dated 31.01.1985 and also as per decision of this Court in the case of G.S.T. v. Neera Drinks 1999 UPYTC. 1130 ?
(D) Whether on the facts and in the circumstances of the case, the Trade Tax Tribunal was legally justified in treating 'Martha and LassV as one and the same commodity and imposing tax as per Notification No. Kani 2-101/XI ' dated 15.01.2000 when the 'Martha' is exempted from tax as it is covered under the word "Milk" and exempted under the Notification No. ST-U-7038/Xdated31.01.1985 ?
3. The applicant is a unit of Provincial Cooperative Dairy Federation, Lucknow and is duly registered under U P. Trade Tax Act, 1948. Applicant was carrying on the business of manufacture of butter, ghee paneer, curd, mattha and purchases and sales of milk and claimed to have maintained the books of account in the regular course of business. During the year under consideration, applicant had disclosed the taxable turn over at Rs.l,38,36,492.91p. Assessing authority had rejected the books of account and estimated the taxable turn over at Rs. 2 crores. First appellate authority allowed the appeal in part. First appellate authority however, confirmed the rejection of books of account and estimate of turn over. Applicant filed appeal before the Tribunal. Tribunal by the impugned order dated 18th January, 2006 allowed the appeal in part. Tribunal has confirmed the rejection of books of account but has reduced the taxable turn over to Rs. 1,55,50,000.
4. Tribunal has rejected the books of account mainly on the ground that there was a difference in the turn over disclosed in Form 4 and turn over disclosed as per books of account. The explanation given by the applicant in this regard is held not acceptable.
5. Tribunal has further confirmed the levy of tax on the turn over of flavoured milk estimated at Rs. 10,000/- and has also treated the mattha as lassi and levied tax @ 5%. Tribunal has also I confirmed the estimate of turn over of sweet meat made of khoya at Rs. 1 lac while according to applicant sweet meat was not prepared and sold.
6. Heard learned Counsel for the parties.
7. Learned Counsel for the applicant submitted that the rejection of books of account and the estimate of turn over are not justified, inasmuch as based on irrelevant considerations and without considering the explanation of the applicant.
8. Learned Counsel for the applicant submitted that explanation has been given by the applicant explaining the difference in the turn over disclosed in the return and as per the books of account but the Tribunal without considering the such explanation has upheld the rejection of books of account.
9. He submitted that the Tribunal has erred in levying the tax on the flavoured milk while flavoured milk is basically milk and is exempted under the Notification No. 7038/X-7, dated 31.01.1985 as held by this Court in the case of CST v. Neera Drinks, Muzaffarnagar, reported in 1999 UPTC 1130. He further submitted that the Tribunal has erred in treating the mattha as lassi. He submitted that mattha and lassi are two different commodities. He submitted that mattha is basically milk with less fat, hence exempted under Notification No. 7038/X-7, dated 31.01.1985. He submitted that the applicant had never manufactured sweetmeat and.thus estimate of turn over of sweetmeat made of klioya is not justified. Learned Standing Counsel relied upon the order of the Tribunal.
10. I find substance in the argument of learned Counsel for the applicant. Perusal of the order of the Tribunal shows that the explanation given by the applicant in respect of the difference in the turn over disclosed in the return and as per books of account has neither been referred nor considered. Tribunal has only observed that the explanation is not acceptable, which is not justified. In my opinion, matter requires reconsideration. Tribunal is directed to consider the explanation of the applicant about the difference in the return version and book version and, thereafter, decide the issue with regard to the rejection of books of account and enhancement of turn over.
11. So far as other question is concerned, namely, levy of tax on the turn over of flavoured milk is concerned, I do not find any error in the order of Tribunal. Flavoured milk is prepared after mixing the dry fruits etc. In common parlance it is understood as soft drinks and not as a milk. In Writ Petition (Tax) No. 1269 of 1989 in the case of CIT v. S/S Gujarat Cooperative Milk Marketing Federation Limited, Kanpur flavoured liquid milk sold by Gujarat Cooperative Milk Marketing Federation Limited has been held as milk product and not milk. On a question being raised whether flavoured milk was liable to tax under the entry of milk product or as condensed milk or as soft beverages. In the case of CTT v. S/S Gujarat Cooperative Milk Marketing Federation Ltd., Kanpur, reported in 2005 NTN (Vol.27), 195, this Court held that the flavoured milk is liable to tax as a soft beverages. Thus, claim of the applicant that it was exempted from tax is hereby rejected. In the case of CST v. M/s Neera Drinks, Muzaff'arnagar, (Supra), the item involved was sweeten milk described ;is milk badam sold in bottles with caps. In the said case decision of this Court in Writ Petition (Tax) No. 1269 of 1989 in the case of CIT v. S/S Gujarat Cooperative Milk Marketing Federation Limited, Kanpur has not been considered and findings of the Tribunal treating it as milk has been upheld.
12. I do not agree with the learned Counsel for the applicant that the mattha being a milk is exempted form tax. Mattha is a milk product and is sold after mixing the salt and jeera etc. and is not a milk. Order of the Tribunal rejecting the claim of exemption on the turn over of mattha is upheld.
13. Order of the Tribunal levying the tax on the sweetmeat is also upheld. Applicant itself disclosed the turn over of sweetmeat at Rs. 72,270/- made of khoya. Thus, preparation made of khoya being sweetmeat liable to tax accordingly.
14. The aforesaid questions are answered accordingly.
15. In the result, revision is allowed in part. Order of the Tribunal is set aside so far as rejection of books of account and estimate of turn over is concerned. Matter is remanded back to the Tribunal to decide the appeal afresh in the light of the observations made above.