Heard learned counsel for the assessee and learned Standing Counsel for the State.
This revision has been filed by the assessee against the order of th Tribunal dated 28.2.2002 by which the Tribunal has imposed tax on the assessee on the supply of stone ballast and grit to the PWD department. The questions of law referred to are hereunder:-
(i) Whether, the Tribunal has failed to exercise its jurisdiction to decide all the grounds set forth in the Memo of Appeal and raised before it through arguments?
(ii) Whether, the order of the Tribunal suffers from perversity in as much as relevant material on record has not been considered and the order has been passed merely on presumptions and conjectures ?
(iii) Whether, the assessment made against the applicant suffers from manifest illegality ?
(iv) Whether, the assessment made against the applicant is wholly arbitrary, capricious and based merely on presumptions and conjectures ?
The contention of the learned Counsel for the assessee is that the order of the Tribunal is perverse because the Tribunal has on the basis of presumption identified the firm Ram Krishna Agrawal with the individual and on the basis of presumption imposed taxes on the firm for the supply of Stone ballast and grit, even though, there was nothing on record to establish that the firm has actually supplied the Stone ballast and grit.
It is the assessee's case that the assessee never entered into any agreement with the PWD department for the supply of any material and in fact was only executing small time job works for which payments were made to the firm for amounts not exceeding Rs.5000/-.
The case of the department on the other hand is that the assessing authority has made a best judgment assessment against the assessee on the basis of an SIB report that the assessee i.e. firm had entered into certain agreements with the department to make supplies of materials.
In reply to the stand taken by the department, the assessee clearly took a stand before the assessing authority that he did not have any agreement with the PWD department.
Learned Counsel for the assessee has relied on Rule 75 of the U.P. Trade Tax Rules, 1978 and has argued that it was always open to the department to compel any document that it may have required to sustain the assessment. However, it did not do so. He also argues that the burden to establish the facts necessary to sustain the assessment lay on the department and it could not have been shifted on the assessee to prove something negatively against it. Learned Counsel for the assessee has further argued in fact the assessee firm produced the copy of the partnership deed of the firm but the very existence of the firm has been denied by the department.
Having heard learned counsel for the assessee and learned Standing Counsel, I am of the opinion that the arguments as raised by the learned counsel for the assessee have substance. Since the entire exercise of making the best judgment assessment was initiated on the basis of information received by the department itself that there were certain agreements, it was always open to the department to invoke the procedure set out in Rule 75 to compel any document that it may have required. However, it did not do so. The matter is thus, remanded to the assessing authority to invoke Rule 75 to its aid and to re-examine the matter after calling for the alleged document from the PWD department. The matter on remand may be considered by the assessing authority within a period of three months from the date of production of a certified copy of this order before him. Certified copy of this order be placed before the assessing authority within three weeks from today. The order dated 28.2.2002 is set aside.
The Revision is allowed.
In case, the assessee has made any deposits in pursuance of the impugned orders the same shall remain in deposit till fresh orders are passed. Dt/-7.1.2010 S.P.