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2018 (12) TMI 1413 - HC - VAT and Sales TaxJurisdiction - suo motu revisional powers - second sale exemption - Whether on the facts and in the circumstances of the case, the Joint Commissioner is right in law in exercising suo motu revisional powers under Section 37 of the Act in setting aside the order of the Appellate Authority? - Held that - In the case on hand, the documents namely, the validity of the registration certificate is upto 31.03.1990 is not disputed by the Department. The payment made through Banking channels have been found to be correct. Therefore, the petitioner has discharged the onus cast upon them to prove that the first seller is real and identifiable person. By merely relying upon the Village Administrative Officer certificate, these records produced by the appellant could not have been discredited by the respondent. The cancellation of the registration of the selling dealer with effect from 01.04.1990 would have no impact on the transaction in question particularly on the appellant and the liability to pay tax cannot be shifted on the appellant - appeal allowed.
Issues:
1. Validity of the exercise of suo motu revisional powers by the Joint Commissioner under Section 37 of the Act. 2. Dispute regarding the denial of second sale exemption to the appellant. 3. Assessment of the factual findings by the Appellate Assistant Commissioner. 4. Burden of proof regarding the authenticity of documents certified by governmental authorities. 5. Impact of the cancellation of the selling dealer's registration on the appellant's liability to pay tax. Issue 1: Validity of the exercise of suo motu revisional powers by the Joint Commissioner under Section 37 of the Act. The appellant challenged the order passed by the Joint Commissioner under Section 37 of the Tamil Nadu General Sales Tax Act, 1959, questioning the Commissioner's authority to set aside the order of the Appellate Authority. The Court examined whether the Joint Commissioner was justified in exercising suo motu revisional powers in this case. Issue 2: Dispute regarding the denial of second sale exemption to the appellant. The dispute centered around the denial of second sale exemption to the appellant by the Assessing Officer, based on the closure of the selling dealer's business and the cancellation of their Registration Certificate. The Appellate Assistant Commissioner reversed this decision, finding that the appellant had indeed purchased goods from the selling dealer, supported by valid documents such as invoices and check post seals. Issue 3: Assessment of the factual findings by the Appellate Assistant Commissioner. The Court analyzed the thorough verification conducted by the Appellate Assistant Commissioner, which established the legitimacy of the appellant's purchases and the continuity of the selling dealer's business during the relevant period. The Court noted discrepancies in the Assessing Officer's observations and upheld the Appellate Assistant Commissioner's findings. Issue 4: Burden of proof regarding the authenticity of documents certified by governmental authorities. The Court emphasized that the burden of proof lies on the party disputing the authenticity of documents certified by governmental authorities. In this case, the respondent failed to discredit the documents produced by the appellant, including the check post seal, which is presumed valid unless proven otherwise. Issue 5: Impact of the cancellation of the selling dealer's registration on the appellant's liability to pay tax. The Court clarified that the cancellation of the selling dealer's registration after the transactions in question did not shift the tax liability to the appellant. Citing relevant case law, the Court held that the appellant had fulfilled the onus of proving the legitimacy of the first seller, and the cancellation of the selling dealer's registration post transactions did not affect the appellant's tax obligations. In conclusion, the Court allowed the tax case appeal, setting aside the respondent's order and restoring the Appellate Assistant Commissioner's decision in favor of the appellant. The judgment highlighted the importance of factual verification, burden of proof, and adherence to legal principles in tax assessments.
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