1991 (7) TMI 311 - HC - VAT and Sales Tax

Summary

Issues:
1. Assessment of suppressed transactions under the Gujarat Sales Tax Act and the Central Sales Tax Act.
2. Appeals before the Assistant Commissioner of Sales Tax.
3. Second appeals before the Tribunal.
4. Reference to the High Court on two specific questions.

Analysis:
1. The judgment pertains to a reference under section 69 of the Gujarat Sales Tax Act, 1969, involving an applicant who is a registered dealer carrying out the business of manufacturing aluminium utensils and circles. The Sales Tax Officer found suppressed transactions in sales and purchases, leading to an enhanced assessment and imposition of penalties under relevant provisions. The applicant-dealer appealed before the Assistant Commissioner of Sales Tax, who partially allowed the appeals resulting in a reduced liability of tax and penalty amounting to Rs. 2,54,725.62.

2. Subsequently, the dealer filed second appeals before the Tribunal challenging the assessments under both the Gujarat Act and the Central Act. The Tribunal dismissed both appeals through a common judgment, prompting the dealer to seek reference to the High Court on multiple questions. However, after due consideration, the Tribunal opined that only two questions required reference to the High Court, focusing on the nature of transactions and the reliance on seized records for assessment purposes.

3. Upon reviewing the Tribunal's judgment and relevant records, the High Court observed that the Sales Tax Officer and the Assistant Commissioner had appropriately relied on materials seized during the search, including records from a third party, for assessing the dealer's turnover of sales and purchases. The High Court emphasized that the correctness of evidence considered is a matter of fact, not a question of law. Consequently, the High Court deemed the first question referred as a question of fact and not necessitating a legal answer.

4. As for the second question regarding the authority of sales tax authorities to draw inferences from seized records, the High Court reiterated that since the first question was factual, the second question did not warrant a legal response either. Therefore, the High Court concluded that both questions did not involve legal considerations and did not require answers. The reference was thus answered accordingly, with no costs imposed on either party.