1969 (1) TMI 63 - HC - VAT and Sales Tax

Summary

Issues:
Acceptance of duplicate 'C' Forms in case of lost originals under the Central Sales Tax Act, 1956.

Detailed Analysis:
The case involved a registered dealer, C.L. Sharma, claiming a reduced tax rate under section 8(1)(b) of the Central Sales Tax Act, 1956, for sales made in the course of inter-State trade. The dealer produced 'C' Forms signed by the purchasing dealer, as required by section 8(4) of the Act. However, eight of the declarations were duplicates as the originals were lost. The assessing authority rejected these duplicates, stating that the sales did not qualify for the reduced tax rate. The Tribunal later admitted the duplicate forms, leading to the reference of the legal question to the High Court.

The Court examined the relevant rules, specifically Rule 8 of the Madhya Pradesh Sales Tax (Central) Rules, 1957, which governs the use and production of 'C' Forms. The rule mandates that the selling dealer must furnish the original portion of the form to the assessing authority to claim the benefit under section 8(1) of the Act. The duplicate portion is to be produced in addition to the original if required by the assessing authority. In cases of loss of the form by the selling dealer, compliance with specific clauses of Rule 8 is necessary.

The Court clarified that the duplicate form referred to in the rules is the one obtained from the purchasing dealer under clauses (iv) and (v) of sub-rule (5-A) of Rule 8. This duplicate form includes three portions - "counterfoil," "duplicate," and "original," with an additional declaration in Form No. VII-A. The Court emphasized that only this specific duplicate form can be used by the selling dealer in case of loss of the original form. The duplicates produced by the dealer in this case were not the ones referred to in the rules, and thus, their acceptance was deemed improper.

In conclusion, the Court held that duplicate 'C' Forms can be accepted in case of lost originals only if they comply with the requirements of clauses (iv) and (v) of Rule 8. Since the duplicates accepted in this case did not meet these criteria, their acceptance was deemed illegal. The Court granted the dealer an opportunity to produce the correct duplicates as per the rules, ensuring justice in the matter.

Therefore, the Court answered the legal question by stating that the acceptance of the duplicates in this case was not legal and proper, as they did not align with the specific requirements outlined in the relevant rules.