1997 (2) TMI 528 - HC - VAT and Sales Tax

Summary

Issues:
1. Assessment of turnover under the Kerala General Sales Tax Act, 1963.
2. Liability to pay sales tax on the turnover of second sale of foreign liquor.
3. Rejection of accounts by the Tribunal due to irregularities found on inspection.
4. Quantum of addition sustained by the Tribunal based on irregularities in sale bills and shortages of liquor.

Analysis:
1. The judgment deals with a partnership-firm engaged in the sale of cooked food and foreign liquor under the Kerala General Sales Tax Act, 1963. The assessing authority disputed the turnover declared by the firm, leading to an appeal process resulting in the firm approaching the High Court in revision.

2. The firm argued that as a second seller of foreign liquor, it should not be liable to pay sales tax on the turnover of the second sale. The counsel emphasized that shortages found during inspection should not attract tax, citing a previous court decision. However, the Tribunal upheld the rejection of accounts due to irregularities, including manipulations in sale bills and shortages of liquor.

3. The High Court found no illegality in the Tribunal's decision to reject the firm's accounts based on the irregularities observed during inspection. The Court supported the Tribunal's stance on sustaining the rejection of accounts, indicating that the decision was lawful.

4. Regarding the quantum of addition to the turnover sustained by the Tribunal, the High Court analyzed the irregularities found during inspection, such as manipulations in sale bills and shortages of liquor. The Court upheld the Tribunal's decision to add a percentage to the turnover, considering the irregularities present. The Court referenced previous judgments to support the Tribunal's decision, emphasizing that the findings were based on facts and evidence available on record.

5. Ultimately, the High Court dismissed the revision, stating that there was no merit in interfering with the Tribunal's findings of fact. The Court upheld the Tribunal's decision on the addition to the turnover, concluding that the revision was without justification.