2007 (9) TMI 562 - HC - VAT and Sales Tax

Summary

Issues:
1. Claim of exemption disallowed due to non-furnishing of requisite form.
2. Disallowance of exemption on purchases for not affixing required ticket.
3. Acceptance of forms as additional evidence by the Deputy Commissioner (Appeal).
4. Tribunal's decision to allow exemption without giving opportunity of rebuttal.
5. Interpretation of Section 12B of the U.P. Sales Tax Act.
6. Legality of the Tribunal's interference with the Deputy Commissioner's order.

Analysis:
1. The dealer's claim of exemption was disallowed by the assessing authority for not furnishing the prescribed form under section 3D(7) read with rule 12B of the U.P. Trade Tax Rules, 1948. Additionally, for the assessment year 1992-93, exemption for a specific amount was disallowed due to the absence of a required ticket on form IIIC(2).

2. The Deputy Commissioner (Appeal) accepted the forms filed as additional evidence by the dealer and remanded the matter back to the assessing authority for verification. The appellate authority also directed the dealer to submit a fresh form IIIC(2) for the assessment year 1992-93, leading to a further remand of the case.

3. The Tribunal, through its order, allowed the dealer's appeals and granted exemption against the forms submitted as additional evidence before the Deputy Commissioner (Appeal). However, the Tribunal's decision was challenged on the grounds of not providing the assessing officer with an opportunity of rebuttal as required under section 12B of the Act.

4. The court found merit in the argument that section 12B of the U.P. Sales Tax Act mandates providing the assessing authority with an opportunity for rebuttal after accepting additional evidence. Since this opportunity was not given, the Tribunal's decision to allow the claim of exemption directly was deemed illegal.

5. The interpretation of section 12B was crucial in determining the legality of accepting additional evidence without affording the assessing officer a chance for rebuttal. The court held that the Deputy Commissioner's decision to remand the matter for verification was in line with the statutory requirement.

6. Consequently, the court allowed both revisions, setting aside the Tribunal's order and restoring the decision of the first appellate authority. The assessing authority was directed to pass assessment orders for both the relevant years in compliance with the law.