1959 (9) TMI 44 - HC - VAT and Sales Tax

Summary

Issues:
Assessment of sales tax on a commission agent dealing in foodgrains and oil-seeds for specific periods. Discrepancies in the accounts found during assessment. Disputed ownership of booklet and slips containing sales accounts. Best of judgment assessment by the Superintendent of Sales Tax. Appeals and revision applications dismissed. Question of law referred to the High Court regarding the legality of assessment based on double the gross turnover.

Detailed Analysis:
The case involves the assessment of sales tax on a commission agent dealing in foodgrains and oil-seeds for various periods. Discrepancies were found in the accounts during the assessment process, leading to suspicion of suppressed sales. The Area Inspector discovered a booklet and slips containing sales accounts not recorded in the regular books of account. The ownership of these documents was disputed, with the dealer initially claiming they belonged to someone else. However, subsequent investigations led to the conclusion that the suppressed sales were indeed made by the dealer, resulting in a best of judgment assessment by the Superintendent of Sales Tax, enhancing the gross turnover by three times.

The appeals and revision applications filed by the dealer were dismissed at various levels of the tax authority hierarchy, ultimately leading to a revision application before the Board of Revenue. The Board of Revenue modified the assessment by doubling the gross turnover instead of tripling it as done by the Superintendent of Sales Tax. The dealer then sought a decision from the High Court on the legality of the assessment based on double the gross turnover.

In a similar assessment for a different period, the Board of Revenue remanded the case for further inquiry regarding the ownership of the booklet and slips and the alleged forgery. The Board did not accept the rejection of accounts solely based on the recovery of these documents without further investigation. The dealer contended that since the Board did not accept such rejection in a previous case, it should not have accepted it in the current assessment. However, the High Court found no legal impediment for the Board to base its decision on the available evidence, even if it had taken a different stance in a prior case.

The High Court emphasized that the question of ownership of the booklet and slips was a factual matter, and there was no evidence to dispute the findings of the lower courts on this issue. The High Court upheld the decision of the Board of Revenue, ruling against the dealer and directing them to pay the costs of the reference.

In conclusion, the High Court concurred with the decision of the Board of Revenue regarding the assessment based on double the gross turnover, dismissing the dealer's contentions and upholding the legality of the assessment.