1987 (6) TMI 378 - HC - VAT and Sales Tax

Summary

Issues:
1. Assessment of taxable turnover under the Kerala General Sales Tax Act for the assessment year 1975-76.
2. Acceptance of additional evidence by the Sales Tax Appellate Tribunal without following proper procedure.

Analysis:

Issue 1: Assessment of Taxable Turnover
The case involves the assessment of taxable turnover under the Kerala General Sales Tax Act for the assessment year 1975-76. The respondent, a contractor for supply of metals, rubbles, gravel, and sand, was assessed by the assessing authority based on supplies made to M/s. Tarapore and Company. The assessing authority proposed to determine the total sales by adding 10% to the sale price of supplies to cover probable supplies to other parties. The respondent objected, citing incomplete formalities. The Assistant Commissioner limited the taxable turnover to the actual cost of supplies to M/s. Tarapore and Company. The Sales Tax Appellate Tribunal, upon review, held that the taxable turnover should exclude charges for loading, unloading, and transport as per the letter of acceptance from M/s. Tarapore and Company. The Tribunal set aside the assessment, remitting the matter to the assessing authority for a revised assessment excluding the mentioned charges.

Issue 2: Acceptance of Additional Evidence
The Revenue challenged the decision of the Sales Tax Appellate Tribunal on the grounds of accepting additional evidence without following due procedure. The Tribunal accepted a letter from M/s. Tarapore and Company, handed over by the assessee's representative during the hearing, without adhering to the regulations governing the admission of fresh evidence. The Tribunal's actions were deemed illegal and without jurisdiction as they did not afford the opposite party an opportunity to be heard, did not record reasons for admitting the evidence, and bypassed the established procedure. The Court emphasized the importance of following statutory provisions to ensure fairness and adherence to natural justice principles. Consequently, the Court set aside the Tribunal's order and remitted the matter for reconsideration in compliance with proper procedures and regulations.

In conclusion, the Court's decision highlights the significance of procedural compliance in admitting additional evidence during appellate proceedings and emphasizes the need for statutory bodies like the Sales Tax Appellate Tribunal to adhere to established regulations to ensure fairness and justice in tax matters.