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TMI Blog1978 (9) TMI 159X X X X Extracts X X X X X X X X Extracts X X X X ..... peal under section 20(1) of the Bengal Finance (Sales Tax) Act, 1941. The Assistant Commissioner, Commercial Taxes, North Circle, by his order dated 28th October, 1972, dismissed the said appeal and confirmed the assessment of the Commercial Tax Officer in respect of the four quarters ending 31st December, 1967. The Commercial Tax Officer by another assessment order dated 29th January, 1973, in respect of the four quarters ending 31st December, 1968, again disallowed certain deductions of sales to other registered dealers on the ground of certain alleged defects in the declaration forms relating to the said sales. Thereafter, the Commercial Tax Officer had issued a notice under section 11 read with section 14(1) of the Bengal Finance (Sales Tax) Act, 1941, upon respondent No. 1 in respect of the returns submitted by him for four quarters ending 31st December, 1969. Respondent No. 1 filed a writ petition, being Civil Rule No. 394(W) of 1973*, inter alia, challenging the aforesaid two assessment orders of the Commercial Tax officer, Jorasanko Charge, in respect of the four quarters ending 31st December, 1967, and the four quarters ending 31st December, 1968, the appellate order of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e two periods of assessment concerning the alleged sales made by the respondent although the registered dealer concerned had produced declaration forms in support of the said transactions. Rule 27A(1), inter alia, prescribes that 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-clauses (ii), (iii) and (iv) of clause (a) of section 5(2) shall on demand produce in respect of such sale the copy of the relevant cash memo or bill and a declaration in form XXIV duly filled in and signed by the purchasing dealer. Under the proviso to rule 27A(1), a declaration in a form in contravention of the provisions of clause (a) or clause (b) of the said proviso shall not entitle the dealer who accepts such declaration to make any deduction under this sub-rule on the strength thereof. Form XXIV, which is the prescribed form of declaration, inter alia, requires the particulars of (a) purchase order No. and date, (b) bill/cash memo No., date and amount, (c) dealer's challan No. and date to be furnished. In the form of the declaration, the challan number is also required to be state ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the duty was cast upon the purchasing dealer to fill up the prescribed form in the prescribed manner and therein to include the prescribed particulars. If the purchasing dealer fails or neglects to fill up the prescribed form in the prescribed manner or fails or neglects to include the prescribed particulars therein, the selling dealer may not compel him to correct the errors or omissions. According to their Lordships, the object behind the provisions contained in the proviso to section 5(2)(a)(ii) is to identify the particular registered dealer to whom sales have been made. If sales to registered dealers are not required to be covered by the declaration forms, according to their Lordships, it might have been possible for dishonest selling dealers to claim enormous deductions even if no sales had in fact been made. Their Lordships in the case of Shri Anil Kumar Dutta v. Additional Member, Board of Revenue, West Bengal[1967] 20 S.T.C. 528 at 538., held that the learned Advocate for the revenue was not wholly right in his contention that the requirements of section 5(2)(a)(ii), proviso, and of rule 27A read with form XXIV should be treated as obligatory or mandatory and that no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for which goods purchased are intended to be used. The Supreme Court repelled the said contention because it was not borne out by the Central Sales Tax Act, 1956, and the Central Sales Tax (Registration and Turnover) Rules, 1957. According to the Supreme Court, when the purchasing dealer furnishes a certificate in form C without striking any of the four alternatives, it is a representation that the goods purchased are intended to be used for all or any of the purposes, and the certificate complies with the requirements of the Act and the Rules. The sales tax authority is, of course, competent to scrutinise the certificate to find out whether a certificate is genuine. He may also, in appropriate cases, when he has reasonable grounds that the goods purchased are not covered by the registration certificate of the purchasing dealer, make an enquiry about the contents of the certificate of registration of the purchasing dealer. But it was not for the tax officer to hold an enquiry as to whether the goods specified in the certificate of registration of the purchaser can be used for any of the purposes mentioned by him in form C or that the goods purchased have in fact been used for the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ect of the defects in the declaration forms in the aforesaid two assessment periods. The Commercial Tax Officer in his assessment order for the four quarters ending 31st December, 1967, gave the following reasons. In the first place, he referred to certain sales to registered dealers whose registration certificates were subsequently cancelled. The Division Bench in Shri Anil Kumar Dutta v. Additional Member, Board of Revenue, West Bengal[1967] 20 S.T.C. 528., specifically laid down that the fact that the sales were made shortly before the surrender of the registration certificate by the purchasing dealer is a matter of little consequence. So long as a purchasing dealer remained a registered dealer, he is entitled to purchase without the payment of sales tax against declaration forms supplied by him. The cancellation of registration of such a purchasing dealer on a later date does not invalidate the declaration form given in respect of purchases effected prior to such cancellation. The Commercial Tax Officer in his impugned assessment order for the four quarters ending 31st December, 1968, had again rejected the declaration forms on the same ground that the dealers who had furnished ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndusthan Stationery Works (Pvt.) Ltd. v. Member, Board of Revenue[1971] 27 S.T.C. 394 at 397-398. The learned Judges in the said case had distinguished the earlier Division Bench decision in Durga Sree Stores v. Board of Revenue, West Bengal(1). In Hindusthan Stationery Works (Pvt.) Ltd.'s case(3), the genuineness of the purchases were not proved before the authority concerned. It was established that the sales were in fact effected to registered dealers. In some cases, sales were effected after the registration of the purchasing dealers had been cancelled (vide pages 397-398 of the Reports). Their Lordships did not also pronounce that form XXIV declaration was mandatory. Thus, the decision in Hindusthan Stationery Works (Pvt.) Ltd. v. Member, Board of Revenue[1971] 27 S.T.C. 394 at 397-398., is in fact distinguishable from the present case, where the declaration forms were granted before the registration of the purchasing dealer was cancelled and there had been no categorical finding by the revenue authorities that relative sales were not real. The learned Advocate for the appellants has also pointed out that the Commercial Tax Officer in the two assessment orders and also the As ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner of the said case had moved a writ petition which was entertained by the Allahabad High Court. If the High Court had not entertained his petition, the petitioner could have moved the Commissioner in revision. The Supreme Court in L. Hirday Narain v. Income-tax Officer, Bareilly[1970] 78 I.T.R. 26 at 31 (S.C.); A.I.R. 1971 S.C. 33 at 36. , was unable to hold that because the revision application could have been moved for an order correcting the order of the Income-tax Officer, but was not moved, the High Court would be justified in dismissing as not maintainable the petition which was entertained and was heard on the merits. In the above view, we hold that the learned single Judge rightly quashed the impugned assessment orders in respect of the periods ending 31st December, 1967, and 31st December, 1968, including the appellate order in respect of the four quarters ending 31st December, 1969. It is, however, necessary to clarify that the Commercial Tax Officer, Jorasanko Charge, would be at liberty to make fresh assessments in respect of these two periods if not otherwise barred. In making the said assessments, the Commercial Tax Officer would be required to determine ..... X X X X Extracts X X X X X X X X Extracts X X X X
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