1974 (4) TMI 91 - HC - VAT and Sales Tax

Summary

Issues:
- Assessment of turnover for the years 1964-65 and 1965-66 by the Sales Tax Officer.
- Revision by the Commissioner of Sales Tax and remand by the Judge (Revisions).
- Justification of setting aside assessment orders and remanding for fresh assessment.

Analysis:
The judgment pertains to a partnership-firm engaged in sarrafa business in Agra. The Sales Tax Officer, during regular assessments for 1964-65 and 1965-66, found the firm's books properly maintained and assessed it based on the turnover disclosed in its returns after minor adjustments. However, the Commissioner of Sales Tax sought revision, arguing that the turnover was inadequate as the Sales Tax Officer did not consider factors like past record, stock position, and investments made by the firm. The Judge (Revisions) concurred that the turnover determination should have factored in stock and investment, remanding the case for fresh assessment.

The firm then appealed, questioning the justification of setting aside the assessment orders and remanding for fresh assessment. The High Court opined that if the firm's books were reliable, the Sales Tax Officer was bound to assess based on the returns supported by the accounts. The need to estimate turnover from stock or investments arises only when account reliability is in doubt, which was not the case here. Although adverse remarks were made for one year, the overall satisfaction with the accounts was evident. The Court concluded that the Judge (Revisions) was unjustified in setting aside the assessment orders and remanding for fresh assessment, ruling in favor of the assessee.

In conclusion, the High Court answered the question of law in the negative, stating that the remand was not justified. The assessee was awarded costs, assessed at Rs. 100 for each reference, to be borne by the Commissioner of Sales Tax. The references were thus answered in the negative, favoring the assessee.