1960 (4) TMI 58 - HC - VAT and Sales Tax

Summary

Issues:
Application under Articles 226 and 227 of the Constitution for quashing certificate proceedings due to sales tax liability. Interpretation of a Division Bench decision regarding sales tax on the supply of gunny bags.

Analysis:
The petitioner, a paddy dealer, failed to submit returns to the Sales Tax Officer, leading to an assessment to sales tax and penalty. The Sales Tax Officer based the assessment on estimated turnover figures and imposed a penalty for non-submission of returns. The petitioner did not appeal or revise the assessment, leading to certificate proceedings for tax recovery. The petitioner cited a Division Bench decision exempting sales tax on gunny bags supplied to the government as a purchasing agent. However, the Sales Tax Department argued that the transaction was distinct from paddy supply, requiring specific factual findings for exemption.

The Court noted its limited powers under Articles 226 and 227, unable to delve into disputed facts independently. Referring to precedents, the Court emphasized that if essential facts were not admitted, and the petitioner neglected to provide evidence, the Court couldn't overturn the Sales Tax Officer's findings. To apply the exemption principle, the petitioner needed to prove the absence of a direct sale agreement for gunny bags and establish an agency relationship for their supply. The Court found the petitioner responsible for the lack of essential facts due to negligence.

The petitioner requested a remand to present evidence, but the Court refused, considering the delay and the petitioner's failure to exhaust statutory remedies earlier. The Court dismissed the application, emphasizing the petitioner's responsibility to challenge the assessment timely and exhaust all available remedies. The judgment concluded with the dismissal of the application and the assessment of costs. Judge Das concurred with the decision, leading to the application's dismissal.