1976 (9) TMI 147 - HC - VAT and Sales Tax

Summary

Issues:
- Revision under section 38 of the Madras General Sales Tax Act, 1959 challenging the inclusion of a specific amount in the revised assessment.
- Interpretation of the evidence presented in the form of slips to determine if they relate to sales or purchases.
- Application of section 10 of the Tamil Nadu General Sales Tax Act, 1959 regarding the burden of proof on the dealer.

Analysis:
The judgment pertains to a revision under section 38 of the Madras General Sales Tax Act, 1959, where the Deputy Commissioner of Commercial Taxes contested the order of the Sales Tax Appellate Tribunal regarding the inclusion of a sum of Rs. 2,56,118.61 in the dealer's revised assessment. The Appellate Assistant Commissioner had scrutinized the slips indicating the amount and found that there was no conclusive evidence to establish that all the amounts represented turnover from sales or purchases. Consequently, the Appellate Assistant Commissioner estimated 50% of the amount as non-taxable money transactions and included the remaining 50% in the taxable turnover. However, the Tribunal later deleted the entire amount, asserting that there was no evidence to prove that the sum represented sales or purchases. The revision challenged the Tribunal's decision, contending that the amount should be included in the taxable turnover.

The Tribunal's finding was based on a thorough examination of the slips, which revealed no indication that the amounts mentioned therein were linked to sales or purchases. Consequently, the Tribunal emphasized that it was the department's responsibility to demonstrate that the transactions in question pertained to sales or purchases. The judgment highlighted that if there had been any intrinsic evidence in the slips suggesting a connection to sales or purchases, the burden would shift to the dealer to prove otherwise. Given the lack of evidence in the slips regarding sales or purchases, the Tribunal correctly placed the onus on the department to establish the taxable nature of the transactions.

The judgment also addressed the application of section 10 of the Tamil Nadu General Sales Tax Act, 1959, which places the burden of proving that a dealer's transactions are not taxable on the dealer. However, it was clarified that the term "transaction" in this context specifically referred to sales or purchases. Since the slips did not demonstrate any such transactions, section 10 was deemed inapplicable. Consequently, the court dismissed the revision petition, emphasizing that there was no justification for overturning the Tribunal's decision. The petition was dismissed with costs, and the judgment concluded in favor of upholding the Tribunal's order.