1996 (9) TMI 567 - HC - VAT and Sales Tax

Summary

Issues:
Assessment under Haryana General Sales Tax Act, rejection of claim for sale to registered dealers, best judgment assessment, sufficiency of opportunity for producing evidence, validity of assessment order, time-barred assessment, non-production of books of account, rejection of appeal, period of limitation, best judgment assessment beyond prescribed period.

Analysis:

The judgment pertains to four petitions filed by the assessee under section 42(2) of the Haryana General Sales Tax Act, 1973, involving common questions of law and facts. The assessee, a limited company engaged in the manufacture and sale of electrical automobile parts, faced assessment proceedings for the years 1971-72 and 1972-73 under the Punjab General Sales Tax Act, 1948, and the Central Sales Tax Act, 1956. The primary issue revolved around the rejection of the assessee's claim for sales to registered dealers and the validity of the assessment orders.

The assessee sought direction to the Sales Tax Tribunal, Haryana, to refer five identical questions of law, including the justification for rejecting the claim for sales to registered dealers, the nature of the assessment order, sufficiency of opportunity for producing evidence, and the validity of the assessment order. The assessee contended that the assessment was beyond the prescribed period of limitation, rendering it time-barred.

During assessment proceedings, the assessee failed to produce books of account due to their alleged destruction in a strike-related incident. The Assessing Authority finalized assessments disallowing the claim of sales to registered dealers. Despite the assessee's appeal, both the Joint Excise and Taxation Commissioner (Appeals) and the Sales Tax Tribunal upheld the assessment order, citing lack of effort by the assessee to collect secondary evidence.

The dispute also centered on whether the assessments constituted best judgment assessments and were made within the prescribed period of limitation. The respondent argued that assessments were based on available trading account and balance sheet figures, as the assessee did not provide information on alleged sales to registered dealers.

Ultimately, the Court directed the Sales Tax Tribunal to refer the question of law regarding the best judgment assessment made after the expiry of the prescribed period for the furnishing of returns under the Punjab General Sales Tax Act, 1948, to the High Court for opinion. The petitions were disposed of accordingly, with no costs imposed.