9911796707
TMI Blog1967 (5) TMI 63X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal, against the order of the Commercial Tax Officer, before the Assistant Commissioner of Commercial Taxes. It was contended, before the appellate authority, that the disallowance of the sum of Rs. 6,94,285-10-0 by the Commercial Tax Officer was based on trivial grounds and that the assessee-dealer should not be penalised because some of the purchasing dealers, who were holders of registration certificates, became later on untraceable. The appeal partly succeeded before the Assistant Commissioner of Commercial Taxes and he reduced the amount of disallowance from Rs. 6,94,285-10-0 to Rs. 6,25,497-14-0. Thereupon, the assessee-dealer filed a revision petition before the Commissioner of Commercial Taxes, West Bengal. The case was dealt with by an Additional Commissioner of Commercial Taxes, who dismissed the appeal and further enhanced the figure of disallowance from Rs. 6,25,497-14-0 to Rs. 6,63,642-2-0. At last, the assessee-dealer filed a revision petition before the Board of Revenue, West Bengal, under section 20(3) of the Act. The Board of Revenue partly allowed the application for revision and reduced the amount of disallowance from Rs. 6,63,642-2-0 to Rs. 2,61,336-6-0. We ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 195-3-0 made to Messrs. Lakhi Stores; (viii) Whether there are admissible evidence and vital defects in the declaration in Form XXIV furnished to justify disallowance of the deduction claimed under section 5(2)(a)(ii) of the Bengal Finance (Sales Tax) Act, 1941, in respect of sales of Rs. 11,937-2-0 made to Messrs. Rabindra Company; (ix) Whether there are admissible evidence and vital defects in the declarations in Form XXIV furnished to justify disallowance of the deductions claimed under section 5(2)(a)(ii) of the Bengal Finance (Sales Tax) Act, 1941, in respect of sales of Rs. 17,371-12-0, Rs. 16,863-8-0 and Rs. 22,759-8-0 respectively made to Messrs. G.S. Syndicate; (x) Whether there are admissible evidence and vital defects in the declarations in Form XXIV furnished to justify disallowance of the deductions claimed under section 5(2)(a)(ii) of the Bengal Finance (Sales Tax) Act, 1941, in respect of sales of Rs. 18,517-12-0 and Rs. 15,378-10-0 made to Messrs. Diana Distributors; (xi) Whether there are admissible evidence and vital defects in the declaration in Form XXIV furnished to justify disallowance of the deduction claimed under section 5(2)(a)(ii) of the Bengal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the Bengal Sales Tax Rules, 1941. The material portion of rule 27A is couched in the following language: "(1) A dealer who wishes to deduct from his gross turnover the amount in respect of a sale on the ground that he is entitled to make such deduction under the provisions of sub-clause (ii) of clause (a) of sub-section (2) of section 5 shall, on demand, produce in respect of such a sale,- (a) * * * (b) in any other case, the copy of the relevant cash memo. or bill, according as the sale is a cash sale or a sale on credit, and a declaration in writing signed by the purchasing dealer or by such other person as may be authorised in this behalf by such dealer that the goods in question are- (i) specified in the certificate of registration of such dealer and are intended for resale or are required by such dealer for use by him either in the manufacture of goods for sale or in the execution of any contract, or (ii) required by such dealer for the packing of any goods. (2) A dealer wishing to make a deduction under clause (b) of sub-rule (1) shall not accept, nor shall the purchasing dealer give, a declaration mentioned in the said clause except In a form obtainable on app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pled with the omission to cast last of the transactions evidenced by it bears a date within a month of the purchasing dealer's surrender of the registration certificate, should lead to its rejection. It has been rightly rejected." Question No. 5.-Defects in the two declarations, all In Form XXIV, supplied by Messrs. Sen Dutta Co., in respect of sales made to them, as noticed by the Board. were: "One of them shows several transactions said to have taken place in April, and the other several transactions being dated 27tb May, 1953. The registration certificate of this dealer was cancelled on 25th June, 1953. Another peculiar feature about both these declaration forms is that the totals of the sales were not cast, although taken over to the reverse page. In the circumstances, the grounds for rejection of these two forms do not appear to me to be inadequate." Mr. S.R. Sen, the learned counsel for the assessee-dealer, placed strong reliance on a decision of this Court in Durga Sree Stores v. Board of Revenue, West Bengal[1964] 15 S.T.C. 186., in which P.N. Mookerjee, J. (Amaresh Roy, J., agreeing with him), overlooked certain defects in filling up declaration forms with the followin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ude those multiple purposes then, in the declaration form, all the alternatives taken together may very well be the purpose of purchase and none of the entries in Form No. XXIV would require to be scored out. In the present case, there is nothing to show that the certificates of registration of the dealers to whom the goods in question were sold, did not include those multiple purposes. Besides, in view of the contents and structures of the several forms (Nos. IIA, IIB and XXIV), It seems to us that the mere non-striking out of the alternatives would not, in any sense, be a fatal defect." Mr. Sen contended on the authority of the above-quoted decision, that the provisions for filling up of the forms, as in section 5(2)(a)(ii) and in rule 27A, were merely directory in nature and not mandatory. He, therefore, contended that non-compliance with the provisions of law in filling up a declaration form will not invalidate but will merely make it irregular. If the irregularity was substantial, then the revenue might emphasise upon the irregularity and reject the declaration form. But where the irregularity was not substantial, the declaration form should not be rejected on trivial ground ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a mere direction or instruction involving no invalidating consequence in its disregard, or as imperative, with an implied nullification for disobedience, beyond the fundamental one that it depends on the scope and object of the enactment. It may, perhaps, be found generally correct to say that nullification is the natural and usual consequence of disobedience, but the question is in the main governed by considerations of convenience and justice and when that result would involve general inconvenience or injustice to innocent persons, or advantage to those guilty of the neglect, without promoting the real aim and object of the enactment, such an intention is not to be attributed to the Legislature. The whole scope and purpose of the statute under consideration must be regarded. The general rule is that an absolute enactment must be obeyed or fulfilled exactly, but it is sufficient if a directory enactment be obeyed or fulfilled substantially. A strong line of distinction may be drawn between cases where the prescriptions of the Act affect the performance of a duty and where they relate to a privilege or power. Where powers, rights or immunities are granted with a direction that cer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve been made it is necessary that the registration certificate number of the purchasing dealer shall be included in the declaration form. By way of further particularisation, the date of the certificate is also to be included in the declaration form. Rule 27A read with the prescribed form further requires that the purchasing dealer shall include a certificate, in the declaration form in the following language, "Certified that the goods ordered for in our purchase order No. dated --------------------------------------------------------- purchased from you as per bill/cash memo. stated below --------------------------------------------------------- supplied under your challan No. dated are for resale ------ use in manufacture of goods for sale ------------------------------------ use in the execution of contracts --------------------------------- packing of goods for resale." The purchasing dealer is required to strike out portions of the certificate which are not applicable to the sale in question and to fill up particulars of bills or cash memos and also the other particulars indicated in the certificate, in the places left blank, In the form, for the purpose. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... form should be treated as directory, which need be substantially complied with. This is, in our reading, also the implication of the judgment of this Court in Durga Sree Stores[1964] 15 S.T.C. 186. in which the non-striking off of inapplicable portions in the declaration was condoned, in the view that it was not fatal. In the instant case, the defect in the declaration forms supplied by Messrs. Horie Stores, covered by question No. 1, was that the date of the registration certificate of the purchasing dealer was not given. The number of the registration certificate was there; the omission to fill in the date of the registration certificate did not make the purchasing dealer unidentifiable. The omission was, therefore, not vital or substantial. As such the declaration should not have been rejected and the amount of sale covered thereby should not have been added back to the taxable turnover. The defects in the two declaration forms supplied by Asoka Stores, covered by question No. 2, were that in one of them the name of the purchasing dealer was mis-spelt, that is to say, instead of writing Asoka Stores the name was written as Asaka Stores. This misspelling did not make the purc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not likely to know when a purchasing dealer may surrender his registration certificate. To find fault with such sales is to suspect a transaction on conjectural grounds and no more than that. We are, therefore, of the opinion that the requirements of law were substantially complied with in this case also. The defects noticed in the declaration form supplied by Messrs. Sen Dutta Co., covered by question No. 5, were two-fold, that is to say, the sale transactions took place shortly before the cancellation of the registration certificate of the purchasing dealer and failure on the part of the purchasing dealer to total up the transactions covered by the form. We have already observed that it is not necessary to total up the several sales covered by the form, under the provisions of the Act read with the Rules and the prescribed forms. Then again, the fact that the transactions with the purchasing dealer took place shortly before the cancellation of the certificate of the purchasing dealer does not have this effect that it invalidates the declaration furnished by the purchasing dealer. So long as a purchasing dealer remains a registered dealer, he is entitled to purchase without ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect of sales made to them, as noticed by the Board, were: "It evidences a series of transactions which are said to have taken place in January, 1954. The registration certificate of this form was cancelled on 3rd February, 1954, as upon local visit it was found that it had already closed its business. Besides, the declaration form contains two signatures which differ from one another." Question No. 9.-Defects in the declaration, in Form XXIV, supplied by Messrs. G.S. Syndicate, in respect of sales made to them, as noticed by the Board were: "One of the declaration forms does not contain the date of the registration certificate by the purchasing dealer. This is a vital omission. Another one contains hardly any signature. What passes as signature in this declaration form is materially different from the signature contained in the other two forms. Not one of the signatures in this form is dated. Although this omission taken by itself, is not material, in conjunction with the circumstances attached to the other two, I am not satisfied that the form evidences a genuine transaction." Question No. 10.-Defects in the declarations, in Form XXIV, supplied by Messrs. Diana Distributors, i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ok place on 30th May, 1953. After the purchasing dealer had closed his business, earlier to 25th March, 1953, there could not be any transactions with him in April or May, 1953. The Inspector's report is certainly evidence against the assessee-dealer. If on the grounds stated above the declarations supplied by Biswanath Choudhury were not found to be genuine, it cannot be said that the Revenue Authorities proceeded without the basis of any evidence. We should notice here that in the order by the Board of Revenue there is an error as to the date of the local inspection report. Cancellation of the registration certificate of Biswanath Choudhury was made on 2nd January, 1953. The Board of Revenue erroneously thought that the local inspection was made not later than 2nd January, 1953, apparently out of confusion. The defects in one of the declaration forms, namely, non-dating of the declaration forms, we do not consider fatal, for reasons hereinbefore indicated. In the vie w that we take, we answer question No. 6 in the affirmative. In the case of Messrs. Lakhi Stores, covered by question No. 7, it appears from the Inspector's report dated 11th November, 1953, that the purchasing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rms, because these are not required to be signed according to specimen signature. On the authority of the decision of this Court in Durga Sree Stores(1), we hold that the omission to put the date below the signature is not fatal. Apart from what has been observed there is no evidence against the genuineness of the transactions. In our opinion, the materials relied upon by the Board, in condemning the transactions covered by the declaration forms as not genuine transactions, are all irrelevant. We, therefore, answer question No. 9 in the negative. Two declaration forms were supplied by Diana Distributors covered by question No. 10. One of them was rejected on the ground that the declaration form was dated 13th January, 1954, but covered transaction up to 30th January, 1954. This ground, in our opinion, is a valid ground for disbelieving the genuineness of the declaration. The other form was rejected on the ground that there were two signatures, one in front and other on the back of the declaration form, which did not tally, and neither of them was dated. We have already expressed the view, on the authority of the decision of this Court in Durga Sree Stores[1964] 15 S.T.C. 186. tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
