Court No. - 59
Case :- SALES/TRADE TAX REVISION No. - 1863 of 2008 Revisionist :- M/S Mohan Grain Agency Opposite Party :- Commissioner Commercial Tax Counsel for Revisionist :- N.C. Gupta Counsel for Opposite Party :- C.S.C.
Hon'ble Saumitra Dayal Singh,J.
1. Heard Sri N.C. Gupta, learned counsel for the revisionist-assessee and Sri B.K. Pandey, learned counsel for the respondent-revenue.
2. Present revision has been filed by the assessee against the order of the Trade Tax Tribunal, Gorakhpur dated 29.7.2008 in Second Appeal No.250 of 2004 for the A.Y. 2000-01 (Central). By that order the tribunal has rejected the appeal filed by the assessee and confirmed the first appeal order and the assessment order.
3. The present revision has been pressed on the following questions of law:
"1. Whether the learned Tribunal as well as the authorities below were justified in rejecting the claim of the revisionist firm on the only ground that the revisionist firm has not produced any evidence with regard to payment of tax within the State of U.P., despite the fact that the assessing authority and other authorities have already accepted that the aforesaid purchase was made from the registered dealers.
2. Whether the learned Tribunal as well as the first appellate authority were justified in not accepting the Form 'C' already filed along with application under Section 12-B."
4. During the assessment year in question, the assessee claimed to have purchased rice from the registered dealer inside the State of U.P. It further claimed to have sold said quantities of rice in the course of inter-state trade. The assessing authority imposed tax on sale of rice purchased in the course of inter-state trade valued at Rs.19,03,088/-. In that regard, learned counsel for the assessee submits that no tax was leviable on that quantity of rice purchased inside the State. in view of the Notification Number S.T.-II-2051 dated 13.9.1990 whereby the State Government had granted exemption from the payment of tax on interstate sale of rice if the tax on such rice had been paid under the U.P. Sales Tax Act, 1948 (hereinafter referred to as the Act).
5. In so far as the assessing authority did not disbelieve the claim of the assessee that the rice had been purchased from the registered dealers, it stood established that rice purchased by the assessee was tax paid.
6. Responding to the above, learned counsel for the respondent- revenue would submit, the fact that the petitioner may not have made the first purchase, may not be decisive of the controversy, inasmuch as, under the exemption notification, the assessee was obliged to establish that the tax had been paid on the quantities of rice purchased by it and therefore, some proof of such tax having been paid by the person from whom the assessee had made purchase of rice, should have been produced during the assessment proceedings. In absence of such proof, the assessee had been rightly subjected to tax.
7. Having heard learned counsel for the parties and having perused the record, the fact that the assessee may have purchased the quantities of rice from the registered dealer, did not ipso facto establish that those quantities of rice had suffered tax. The condition of grant of exemption is not subject to the goods being purchased from registered dealers but that they should have actually suffered tax. The principle that rice was liable to tax at the hands of the manufacturer or importer only governs the levy, in law. However, for a claim of exemption to arise, it was a matter of evidence to be led to establish that the goods had actually suffered tax. In so far as it has been observed by the Tribunal that no proof was adduced to establish such payment of tax and even from the bills produced by the assessee, it was not clear that such tax had been paid, the condition for grant of exemption was not satisfied. Therefore, there is no error on the part of the assessing authority in refusing the grant of exemption in terms of notification dated 13.9.1990.
8. In so far as the application to lead additional evidence and thereby rely on certain Form'C' had been rejected by the first appeal authority, it does appear that the authority has completely erred in rejecting that application because it had first rejected the claim of exemption on rice purchased by the assessee. The benefit of Form 'C' is independent of claim of the exemption. In fact, it may not have arisen if the claim of exemption had been allowed. However, the exemption having been denied, necessarily the question of applicability of Form 'C' had to be decided on its own merit.
9. Accordingly, the order of the Tribunal sustaining the rejection of application to lead additional evidence, is set aside and the matter is remitted to the First Appeal Authority to pass appropriate order in accordance with law in view of the remand report already existing on record.
10. Accordingly, the revision is partly allowed. Question no. 1 is answered in the negative, i.e. in favour of the revenue and against the assessee. The question no. 2 is answered in affirmative, i.e. in favour of the assessee and against the revenue.
Order Date :- 26.8.2019 Meenu