9911796707
TMI Blog1993 (1) TMI 269X X X X Extracts X X X X X X X X Extracts X X X X ..... two-fold. (1) The alleged interState purchases having been totally denied the petitioner is not liable to pay the penalty. (2) The petitioner had not been granted an opportunity to crossexamine the dealers from whom the inter-State purchases were allegedly made. 3.. Explanation I to section 45A of the Act reads thus: "The burden of proving that any person is not liable to the penalty under this section shall be on such person." This explanation came up for interpretation before the Division Bench of this Court in Sudhi v. Intelligence Officer [1992] 85 STC 337. While examining the constitutional validity of the provision contained in section 45A of the Act, the Division Bench observed that the above "explanation" is not happily worded. However, the provisions is upheld by it on the ground that there is no restriction on the power of the Legislature either to provide presumptions of law or change of burden of proof. Then what is required is that such presumption or change of burden of proof shall not be arbitrary or unreasonable. The presumption in the present case arising out of the availability of declaration forms at the check-post cannot be said to be unreasonable. The fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... prove that the alleged transactions of purchase are clandestine and that the declaration forms are not genuine. It can be said that the first respondent-assessing authority has discharged the initial burden by the reason of the availability of declaration forms which is sufficient enough to create presumption as to the clandestine transactions of purchase. Such presumption can be rebutted by the assessee if he is able to succeed in "proving a preponderance of probability". The Supreme Court while dealing with discharge of burden under section 105 of the Evidence Act observed in State of U.P. v. Ram Swarup AIR 1974 SC 1570 as below: "That is to say an accused may fail to establish affirmatively the existence of circumstances which would bring the case within a general exception and yet the facts and circumstances proved by him while discharging the burden under section 105 of the Evidence Act may be enough to cast a reasonable doubt on the case of the prosecution, in which event he would be entitled to an acquittal. ....The burden which rests on the accused to prove the exception is not of the same rigour as the burden of the prosecution to prove the charge beyond a reasonable do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 40 bags 8,400 By not accounting the purchases, the dealer has sought to evade tax legitimately due to Government. It is therefore proposed to impose a penalty of Rs. 4,000 as provided under section 45A of the Kerala General Sales Tax Act." The main objection raised by the petitioner in exhibit P2 against the proposal to levy penalty is this: "A mere declaration in check-post does not connect us with the concerned purchase bill. If the party delivers in any shape the goods as per bills, there will be a receipt for receiving such goods and will be with the party who sold the consignment. If they are not in a position to produce that we are in no way connected with the transaction. In this case I felt that this is the mischief played by the party who filed declaration for illicit transaction." The petitioner did not make any attempt to prove the above plea in a legally accepted manner. From the nature of the aforesaid allegations and objections thereto what was required to be done by the petitioner for producing the proof in that behalf was to cross-examine the dealers from whom the purchases were allegedly made by him. It would, therefore, be necessary to examine whether the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ment under best of judgment. The ambit and scope of "opportunity of being heard" contained in both these provisions can be said to be similar. 9.. While dealing with the nature of the enquiries under the Incometax Act, the Supreme Court in Vasantlal and Co. v. Commissioner of Incometax [1962] 45 ITR 206 observed: "There is nothing on the record to show that the Income-tax Officer had not disclosed to the assessees the material he had collected by eximining Achaldas and Poonamchand. In any event, the Appellate Assistant Commissioner in the interest of justice and fair play gave the assessees an opportunity to cross-examine these two persons. The Income-tax Officer is not bound by any technical rules of the law of evidence. It is open to him to collect materials to facilitate assessment even by private enquiry. But if he desires to use the material so collected, the assessee must be informed of the material and must be given an adequate opportunity of explaining it." 10.. C.A. Vaidialingam, J., of this Court (as he then was) in Appukutty v. State of Kerala [1963] 14 STC 489 which arose under the TravancoreCochin Sales Tax Act, 1125 observed: "The fact that some third party ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... approved the decision in Appukutty's case [1963] 14 STC 489. Fazal Ali, J., in his concurring judgment in State of Kerala v. K.T. Shaduli Yusuff [1977] 39 STC 478 observed thus: "The High Court in the present appeals has relied on its earlier decision in Appukutty v. State of Kerala [1963] 14 STC 489, where a single Judge of the Kerala High Court pointed out that the fact that a third party maintaining some secret accounts had made certain entries in his accounts which may connect the assessee will not give jurisdiction to the assessing authority to use that information unless the assessee has been given an opportunity to cross-examine him effectively. As no such opportunity was given, the court held that the proceedings stood vitiated. In our opinion, the decision of the Kerala High Court was substantially correct and in consonance with the language of section 17(3) and the proviso thereto." 12.. The question regarding the cross-examination of third parties again came up for consideration before the Full Bench of this Court in the case of Thomas v. State of Kerala [1977] 40 STC 278. After examining the facts of the case, the Full Bench came to the conclusion that the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X
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