2023 (10) TMI 159 - HC - VAT and Sales Tax

Benefit of Central Sale against I Form C provided - HELD THAT - It is admitted that the sales have been disclosed by the revisionist through 23 invoices for a sum of Rs. 2,11,47,201/- to M/s Yash Traders, for which one Form C No. 4930498 has been submitted, but on verification from the corresponding State, i.e., Rajasthan, the information was given that the purchasing dealer has only shown purchase against one invoice no. 45 dated 12.12.2013 for a sum of Rs. 2,75,049/-. The benefit of concession has been given to the revisionist for the said invoice. So far as other 22 invoices are concerned, the same have been disbelieved. The present proceeding is an original proceeding, i.e., the revisionist is claiming concession rate on the strength of Form C. Once the corresponding State authority has sent information that only one purchase made by the purchasing dealer could be verified, the benefit of other purchases as alleged to be made by the revisionist against the said Form C cannot be granted. The onus is upon the dealer to prove its case beyond doubt when the dealer is claiming concession rate of tax. The said onus has not been discharged by the revisionist. The Supreme Court in the case of ITC. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, NEW DELHI 2004 (9) TMI 103 - SUPREME COURT has held that the Assessing Authority is competent to scrutinize the certificate to find out the contents to be genuine and he is competent to inquire about the contents of the certificate to satisfy himself that the goods purchased are verifiable and once the truth of declaration on verification was not found to be correct, the benefit cannot be granted. The judgement relied upon by the revisionist in Star Paper Mills Limited 2003 (10) TMI 625 - ALLAHABAD HIGH COURT is of no aid to it as in the said case, in the first paragraph of the judgement itself it has been mentioned that reassessment proceedings for the assessment year 1984-85 have been initiated under section 21 of the U.P. Sales Tax Act. When the reassessment proceedings are being initiated, the burden is shifted to the Revenue, but in the original proceeding, the onus is upon the dealer to discharge beyond doubt the claim so made. The revisionist has failed to discharge its burden by any cogent material - revision dismissed.

Summary

Issues involved:
The judgment involves the question of whether the Tribunal was correct in granting benefit of Central Sale against Form C No. 4930498 for a specific amount, instead of the amount claimed by the revisionist from M/s Yash Traders, Rajasthan, based on a list of 23 sales invoices.

Summary:

Issue 1: Grant of Concession Rate on Central Sale
The revisionist filed for revision against the order passed by the Commercial Tax Tribunal for the assessment year 2013-14, seeking concession rate on central sales made to M/s Yash Traders, Rajasthan. The revisionist claimed to have made sales against 23 invoices to the purchasing dealer and charged a 2% tax rate based on Form C submitted by the purchasing dealer. The Assessing Authority accepted only one sale to the purchasing dealer and imposed a higher tax rate on the remaining 22 sales. The revisionist contended that as a registered dealer, they were entitled to charge a higher rate but relied on Form C provided by the purchasing dealer for the concession rate. The revisionist argued that they had no control over how the purchasing dealer accounted for the purchases or subsequent use of the goods. The revisionist cited a previous judgment in support of their case.

Issue 2: Burden of Proof for Concession Rate Claim
The Additional Chief Standing Counsel supported the order of the Tribunal, stating that the revisionist failed to justify their sales before the authorities. The Counsel argued that the revisionist did not provide sufficient evidence to support their claim for concession rate on all sales covered by Form C. The Counsel emphasized that in regular proceedings, the onus is on the assessee to prove their claim for concession rate, which the revisionist failed to do in this case. The Counsel further highlighted that verification from the corresponding State revealed that only one purchase was verified, leading to the dismissal of the other alleged purchases.

Judgment:
After hearing arguments from both parties, the Court noted that while the revisionist claimed sales against 23 invoices, verification from Rajasthan authorities confirmed only one purchase by the dealer. The Court emphasized that in original proceedings like this, the burden of proof lies with the dealer to substantiate their claim for concession rate beyond doubt. The Court found that the revisionist failed to discharge this burden adequately. Referring to relevant legal precedents, the Court concluded that the revisionist did not provide sufficient evidence to support their claim, leading to the dismissal of the revision. The question of law was answered accordingly, and the revision was dismissed.