1987 (10) TMI 371 - HC - VAT and Sales Tax

Summary

Issues:
1. Dispute over the turnover determination for the assessment year 1979-80 in a sales tax case.
2. Disagreement on the operational period and production capacity of a brick kiln leading to discrepancies in the turnover calculation.
3. Lack of proper reasoning and notice by the Sales Tax Tribunal in altering the findings of the Sales Tax Officer.
4. Interpretation of Section 18 of the U.P. Sales Tax Act regarding confirmation of assessment by the Tribunal without changes in proprietorship.

Analysis:

1. The revision petition challenged the Sales Tax Tribunal's order regarding the turnover determination for the assessment year 1979-80. The petitioner, engaged in the brick manufacturing business, contested the rejection of account books by the Sales Tax Officer, leading to the estimation of turnover by the Officer and subsequent affirmation by the first appellate court.

2. The Sales Tax Officer determined the operational period of the brick kiln from April 1, 1979, to May 29, 1979, based on a survey conducted in March 1979. Discrepancies arose regarding the number of rounds the kiln operated and its production capacity, with the Officer estimating 1 3/4 rounds and a production of 6,38,050 bricks. The Sales Tax Tribunal adjusted the capacity to 3 lacs of bricks and production to 6,00,000 bricks, citing two complete rounds of operation.

3. The petitioner raised concerns over the Tribunal's decision on the operational start date of the kiln and the number of rounds it operated. The Court acknowledged the factual nature of these determinations but criticized the lack of substantive discussion or notice by the Tribunal when altering the Officer's findings, emphasizing the need for proper justification and opportunity for the assessee to present their case.

4. Regarding the interpretation of Section 18 of the U.P. Sales Tax Act, the Court dismissed the argument challenging the confirmation of assessment by the Tribunal under this section, noting that the issue was not raised before the tax authorities or addressed in the Tribunal's order, precluding its consideration at the Court level.

5. Consequently, the Court partially allowed the revision petition, directing the Tribunal to reevaluate the turnover determination in line with the Court's observations and legal provisions. The parties were instructed to bear their own costs in light of the circumstances surrounding the case.