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TMI Blog1968 (8) TMI 176X X X X Extracts X X X X X X X X Extracts X X X X ..... issued a notice under rule 41(5) fixing a date for hearing to enable him to make an annual assessment. Reapeated adjournments were taken by the dealer, and as the dealer was absent on the date ultimately fixed for hearing the Sales Tax Officer proceeded ex Parte. He estimated the turnover of imported vanaspati at Rs. 58,00,000 and calculating the rate of tax at one anna per rupee computed the tax liability at Rs. 3,62,500. He estimated the turnover of washing soap at Rs. 6,132.30 and taking the rate at six pies per rupee he calculated the tax liability at Rs. 191.62. The total turnover was thus estimated at Rs. 58,06,132.30 and the tax liability was determined at Rs. 3,62,691.62. As the dealer had deposited a sum of Rs. 1,060.43 only towards the tax liability the Sales Tax Officer issued a notice of demand for the balance, namely, Rs. 3,61,631.19. The dealer preferred an appeal under section 9 of the Act. In the memorandum of appeal he admitted the turnover at Rs. 1,66,387.03. One of the grounds taken in the memorandum of appeal was that the dealer, being an importer, was not a "successive" dealer within the meaning of section 3-A of the Act and therefore the higher rate of tax at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed on merits to see if it was a bona fide plea or a frivolous plea, for the purpose of entertaining an appeal under the first proviso to clause (1) of section 9 of the U.P. Sales Tax Act? (4) Whether the plea of the assessee that a dealer making the first sale would not come within the term "successive dealer", occurring in section 3-A of the U.P. Sales Tax Act, is a bona fide or frivolous plea in the circumstances of the case? (5) Whether an assessee can be permitted to raise frivolous pleas and avoid payment of tax which he himself had considered to be due and had realised? (6) Whether the objection to the entertainability of the appeal could be raised after the appeal had been registered in accordance with rule 67 of the U.P. Sales Tax Rules? Special Appeal No. 330 of 1963 arises in the following circumstances. When the revision application mentioned above was dismissed by the revising authority, the dealer filed a petition under Article 226 of the Constitution praying for certiorari against the assessment order, the appellate order and the order made in revision and for mandamus directing the Sales Tax Officer not to take recovery proceedings for realisation of the tax. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e could be no admission as to what is the true rate attracted by the turnover. And no matter what the rate suggested by the dealer, it is for the Sales Tax Officer to determine the true rate. In case the rate applied in the assessment order is erroneous, even if that rate was indicated by the dealer, it is open to the dealer to question the rate by preferring an appeal under section 9(1). The admitted tax is the tax which the dealer admits to be due and which it does not dispute in the appeal either by challenging the turnover assessed by the Sales Tax Officer or by challenging the rate applied by him. It is urged that the tax not disputed in appeal must be taken to have been admitted. The dealer says that it calculated the tax at the time of realising it from the customers, and at the time of filing its return, at one anna per rupee in the case of imported vanaspati and six pies per rupee in the case of washing soap under section 3-A. Then, it says it came to understand that section 3-A did not apply to it because it was not one of the "successive dealers". It says that as an importer it was the first dealer in the State of Uttar Pradesh and should not be considered to be one of t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Tax Act. Accordingly, it held that the High Court had erred in dismissing the writ petition on the ground that the appellant should exhaust his internal remedies under the Act. Now, if an authority constituted under the statute is not entitled to adjudicate upon the vires of a notification issued under that statute, clearly it is not open to a party to raise that ground before the statutory authority. It was not open to the appellate authority in the instant case to pronounce upon the vires of Notification No. ST-905/X dated 31st March, 1956. That being so, ground No. 11 was not a ground which the dealer could take in its memorandum of appeal. It was not a ground upon which the dealer could appeal under the Act. If that ground is excluded from the appeal, then clearly the very foundation disappears upon which the dealer attempts to support its contention that the tax deposited by it before it filed the appeal was the "admitted tax". The notification challenged by the dealer was issued under section 3-A of the Act. It declares that in the case of goods imported from outside Uttar Pradesh the turnover at the point of sale by the importer is liable to tax and the rate is one anna pe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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