2009 (11) TMI 876 - HC - VAT and Sales Tax

Summary

Issues:
1. Whether the Sales Tax Appellate Tribunal's order deleting the turnover of Rs. 54,790 and Rs. 40,340 was legally correct.
2. Whether the burden of proof lies on the assessee to establish that the quotations were not acted upon as per section 10 of the Tamil Nadu General Sales Tax Act, 1959.
3. Whether the Tribunal's decision not to restore the penalty imposed by the assessing authority is correct in law.

Analysis:

1. The case involved an appeal by the Revenue against the Sales Tax Appellate Tribunal's order regarding the disputed turnover of a marble and granite dealer for the assessment year 1991-92. The assessing officer had estimated suppression based on recovered records of quotations and sale bill books. The Tribunal deleted the tax levied by the assessing officer on the turnover of Rs. 56,790 and Rs. 40,340, respectively. The Appellate Assistant Commissioner dismissed the claim due to lack of supporting details, leading to the second appeal before the Tribunal.

2. The Revenue argued that the burden of proof under section 10 of the TNGST Act lies on the assessee to demonstrate that the quotations were not acted upon. However, the Tribunal found no evidence to support that the goods were actually sold based on the quotations. The Tribunal emphasized that the assessing authority did not investigate beyond treating the quotations as sale bills. Consequently, the Tribunal held that there was no basis to sustain the estimates made by the assessing officer, leading to the deletion of the tax on the disputed turnover.

3. The Tribunal's decision not to restore the penalty imposed by the assessing authority was upheld, as there was no substantial evidence to support the imposition of the penalty. The Tribunal's reasoning that there were no materials to treat the quotations as sale bills and estimate the turnover was deemed appropriate. The High Court concurred with the Tribunal's findings, stating that no error or illegality was found in the Tribunal's order. Consequently, the tax case revision was dismissed, and no costs were awarded.

In conclusion, the High Court upheld the Sales Tax Appellate Tribunal's decision to delete the tax on the disputed turnover, emphasizing the lack of evidence to support the assessing officer's estimates. The burden of proof on the assessee regarding the quotations not being acted upon was considered, and the Tribunal's decision not to restore the penalty was supported due to insufficient evidence.