2020 (4) TMI 139 - HC - VAT and Sales Tax

Best Judgement assessment - Merely on the basis, that at that time of the said inspection, the books of account were not found, the SIB Officers made an assessment on the basis of best judgment and raised a tax demand of ₹ 2,36,934.00 - HELD THAT - It is not quite correct on the behalf of the learned counsel for the revisionist to submit that the assessment has been made solely on the basis or presumption that the books of account were not available. The decision of Chawlas Bricks Fields 2000 (7) TMI 999 - ALLAHABAD HIGH COURT is on a different facts situation wherein it was only on the ground that the books of account were not available that the presumption was raised. However, in the present case it would indicate that non-availability of books of account has not been taken as a ground rather it was something which was seen and found at the time of survey, that is loading of oil cake in vehicle and the same did not match with the account books upon which the assessment has been made - Therefore, the aforesaid decision does not come to the rescue of the revisionist. As far as the other submission is concerned, the revisionist was not provided with the copy of SIB report. It will be relevant to mention that the same also does not merit consideration for the reason that this plea was neither raised by the revisionist at any point of time before the authorities nor before the appellate court below, accordingly this plea is being raised for the first time which does not countenance merit. This Court is of the opinion that there is no merit in the aforesaid revision and it is liable to be dismissed - Revision dismissed - decided against revisionist.

Summary

Issues:
1. Revision against judgment under U.P. Value Added Tax Act, 2008 for assessment year 2016-17.
2. Validity of tax demand based on best judgment due to non-production of account books during survey.
3. Allegation of violation of natural justice by not providing copy of survey inspection report to the revisionist.
4. Interpretation of precedents cited by the revisionist regarding assessment based on non-availability of account books.

Analysis:
1. The revisionist challenged the tax demand of &8377; 2,36,934.00 raised after a survey by Special Investigation Bureau (SIB) in 2016. The First Appellate Authority reduced the demand to &8377; 81,381.00. The revisionist then appealed to the Commercial Tax Tribunal, which dismissed the appeal, leading to the current revision before the High Court.

2. The revisionist contended that the tax assessment solely based on non-availability of account books during the survey was erroneous. However, the Court noted that the assessment was not solely due to missing books but also because undisclosed transactions were observed during the survey, such as loading oil cake into a vehicle without corresponding entries in the account books. The Court differentiated this case from precedents where assessments were solely based on missing account books.

3. Another argument raised was the failure to provide the revisionist with a copy of the SIB report, alleging a violation of natural justice. The Court dismissed this argument as it was not raised before lower authorities and lacked merit. Citing a precedent, the Court clarified that not all circumstances mandate providing the SIB report to the assessee.

4. The revisionist relied on precedents to support their case, but the Court found them distinguishable based on the specific facts of the current case. The Court concluded that the revision lacked merit and dismissed it, emphasizing that the assessment was not solely due to missing account books but also undisclosed transactions observed during the survey.

In conclusion, the High Court dismissed the revision against the tax demand, highlighting that the assessment was based on undisclosed transactions observed during the survey, not just the absence of account books. The Court found no violation of natural justice in not providing the SIB report to the revisionist and distinguished the precedents cited by the revisionist based on the specific facts of the case.