Court No. - 59
Case :- SALES/TRADE TAX REVISION No. - 1176 of 2009 Revisionist :- M/S Mukesh Stone Crusher 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. Present revision has been filed by the assessee against the order of the Commercial Tax Tribunal, Moradabad dated 23.09.2009 passed in Second Appeal No. 153 of 2009 for A.Y. 2006-07 (U.P.) filed by the assessee and Second Appeal No. 255 of 2009 for A.Y. 2006-07 (U.P.) filed by the revenue. By that order, the Tribunal has dismissed the appeal filed by the assessee and partly allowed the appeal filed by the revenue and enhanced the disputed tax by Rs. 1,51,000/-.
2. In brief, during the assessment year in question, the assessee was engaged in manufacture and sale of stone, crushed stone and stone dust. It is common case between the parties that the assessee's business premises were subjected to a survey on 19.08.2006. During the course of that survey, following stock position was noted:
Stone - about 40 trucks;
Ready crushed stone (10 mm) - 20 trucks; Ready crushed stone (20 mm) - 20 trucks; Stone dust - 20 trucks;
Stone crushed (various sizes) - 20 trucks.
3. Besides noting the above stock position, certain documents were seized. Amongst them, a weighment slip book of one Sri Bankey Bihari Dharamkanta, Moradabad Road was also seized.
It contained weighment slips for the period 08.08.2006 to 19.08.2006. The total quantity of stone found weighed on such slips was 8925.300 quintals valued at Rs. 2,25,000/-. Further, a diesel generating set was found installed at the assessee's premises. Again, it is admitted that no enquiry was made by the revenue authorities from Sri Bankey Bihari Dharamkanta. It is also not the case of the revenue that the hand-writing on weighment slips was of the assessee or its employee. At the same time, no books of accounts of the assessee were found present at the time of survey. While making the assessment, the books of accounts of the assessee were treated to be rejected on account of the same being found absent at the time of survey, however, while making the estimation of the undisclosed turnover, the assessing officer took note of the survey material, including the weighment slip register recovered from the assessee's premises. The same was attributed to be containing transactions performed by the assessee. Accordingly, the undisclosed purchase of stone from unregistered dealers was estimated at Rs. 5,82,400/-; undisclosed purchase of stone was estimated at Rs. 25,00,000/-; undisclosed sale of crushed stone and crushed stone dust was estimated at Rs. 50,00,000/- and; undisclosed sale of sand was estimated at Rs. 5,00,000/-. Over and above the said the estimation, the assessing officer further estimated undisclosed purchase of diesel oil at Rs. 1,75,000/-. Upon challenge raised by the assessee, the first appeal authority granted partial relief and reduced the estimation of undisclosed sale of crushed stone and stone dust from Rs. 50,00,000/- to Rs. 35,00,000/-; undisclosed sale of sand from Rs. 5,00,000/- to Rs. 3,00,000/- and undisclosed purchase of diesel from Rs. 1,75,000/- to Rs. 1,00,000/-. Upon further appeals, the Tribunal has basically affirmed the order of the first appeal authority with respect to the discoveries made on the basis of the alleged weighment slips. However, it has reduced the relief granted by the first appeal authority and thus enhanced the tax liability by Rs. 1,51,000/-.
4. Heard Shri Aloke Kumar, learned counsel for the assessee and Shri B.K. Pandey, learned Standing Counsel for the revenue.
5. The present revision has been pressed on following questions of law have been pressed:
"(1) Whether a Weighment Slip alone can become the evidence of sale specifically when the same contains only the weight?
(2) Whether mere installation of Generator at the business premises can authorize the authorities to levy tax on the presumed purchase of Diesel specifically when there is nothing on record which may indicate that the production activity has ever been carried out by the Generator?
(3) Whether in absence of any evidence of sale of Reta the liability of tax can be fixed specifically when record reveals the applicant is not involved in the trading of Reta?"
6. Learned counsel for the assessee would submit that no material exists for the purpose of making exaggerated estimation. Thus, it has been submitted that the assessee had disclosed sale of crushed stone and stone dust at Rs. 10,57,216/- and paid tax thereon. The entire stock found at the time of survey was thus accounted for. Specifically with respect to the weighment slip register, it has been submitted that though it may not be disputed that the same was recovered from the business premises of the assessee, however, the assessee disputed its relation with the same. The revenue did not make any enquiry and did not bring any evidence on record to establish the connection of the said weighment slip register with the assessee. Therefore, no inference of sale or purchase made outside the books could have been reached by the assessing officer on such weighment slip register. In any case, neither the assessee was engaged in the sale of sand nor there was any material found to establish such transactions as may have led any addition on that count. Similarly, the assessee had established that it had carried out its manufacturing activities against electrical energy purchased from the distribution companies and had paid Rs. 2,93,500/- under that head. There was no evidence of any manufacturing activity having been performed against electricity produced by the diesel generate set. Therefore, the additions made on account of undisclosed purchase of diesel is wholly unfounded.
7. Opposing the revision, the learned Standing Counsel would submit that insofar as it is admitted to the assessee that the weighment slip register was found from its business premises, a heavy burden lay on the assessee to explain that the same did not reflect its own business transaction. Insofar as there are transactions involving weighment of stone, crushed stone and stone dust found recorded in the said weighment slip register, the same has been correctly attributed to the assessee.
8. Having heard learned counsel for the parties and having perused the record, in the first place, the books of accounts of the assessee came to be rejected in view of the facts noted in the survey recorded on 19.08.2006. During that survey, various stock of stone, crushed stone and stone dust were recorded, as has also been noted above. Also, it is undisputed that the books of accounts and manufacturing register were not produced during that survey. Therefore, the rejection of books of accounts cannot be assailed. Also, keeping in mind the volume of stock recorded at the time of survey, an estimation was necessary to be made by the assessing officer. To that extent, there can be no challenge by the assessee.
9. Coming to the weighment slip register, in the first place, it is revenue's own case that the same was of Sri Bankey Bihari Dharamkanta, Moradabad Road. The revenue authorities never alleged that it was the assessee who was the proprietor of the said Sri Bankey Bihari Dharamkanta. Therefore, the blanket presumption sought to be drawn by the revenue authorities that it was the assessee alone who should have explained the weighment slip register, is an over stretched and hence unacceptable reasoning and the principle that any document seized from the premises of an assessee is presumed to be referable to him. Once the revenue authorities itself found that the document was one belonging to another person inasmuch as it was specifically alleged that the weighment slip register was of Sri Bankey Bihari Dharamkanta, Moradabad Road, it was for the revenue authorities to have first made enquiries from the said person and to have thereafter confronted the assessee with the same if it was found referable to the assessee. It would have been another thing if the weighment slips had been found from the premises of the assessee without mention of the same belonging to Sri Bankey Bihari Dharamkanta. Also, there no evidence on record to establish that the such weighment had been made by the assessee at its own premises. Clearly, that is not the case of the revenue.
10. Coming to the purchase and sale of diesel, it is noted that there is absolutely no evidence and no reasoning contained in any of the orders to establish how an inference of undisclosed purchase of diesel has been drawn. The entire addition appears to be made on whims and fancy. Same is the position with respect to the estimation of sale of sand.
11. Accordingly, the exercise conducted by the first appeal authority and the Tribunal is found to be lacking in vital aspect. While the books of accounts of the assessee have been rightly rejected, the estimation, insofar as it is based on the weighment slip register of Sri Bankey Bihari Dharamkanta without any prior enquiry made from that person, is found to be extraneous.
12. Accordingly, questions of law are answered thus:
Re Question No.(1) : In absence of any prior enquiry made by the assessing officer from Sri Bankey Bihari Dharamkanta, Moradabad Road, the weighment slip register of that person recovered from the assesee could not be attributed to the assessee in absence of any other evidence to establish that the transactions found recorded in such register belonged only to the assessee.
Re Question Nos. (2) & (3) : No addition could have been made on undisclosed purchase of diesel and undisclosed sale of sand in absence of any material, whatsoever.
13. Accordingly, the order of the Tribunal dated 23.09.2009 is set aside. The matter is remitted to the assessing authority to pass appropriate order after affording due opportunity of hearing to the assessee.
14. The revision is partly allowed.
Order Date :- 26.9.2019 AHA