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TMI Blog1995 (10) TMI 220X X X X Extracts X X X X X X X X Extracts X X X X ..... the year 1978-79 under the Tamil Nadu General Sales Tax Act (the TNGST Act, 1959) by the Deputy Commercial Tax Officer on a turnover of Rs. 2,39,705.92, being the purchase of iron and steel goods which had not suffered tax at prior stage. Aggrieved by the revised assessment the assessee filed an appeal before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner took the view that when the dealer deals with another, it was too much to expect that he should find out whether the others business was continuing or not. He therefore allowed the appeal in respect of the purchase made from Jayachandra Traders. 3.. According to the Joint Commissioner, in this case the dealers have purchased iron and steel scrap for Rs. 2,00, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere not registered dealers under the TNGST Act during 1978-79, the sales by the assessee will be liable to be taxed as the first sales. The bills issued by Jayachandra Traders clearly showed that the sales by them were not second sales. Iron and steel are goods which are amenable for tax at the point of first sale in the State. The assessee purchased the said iron from local dealer after paying necessary local tax on the purchases and hence unless and until it is established that the said seller, i.e., Jayachandra Traders had not paid the tax, the question of treating the sales by the assessee as first sale does not arise. Merely because the said Jayachandra Traders were not registered dealers under the TNGST Act during 1978-79 cannot abs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Joint Commissioner came to the conclusion that the Appellate Assistant Commissioner was not correct in allowing the appeal with regard to the purchases made with Jayachandra Traders. It was therefore contended that the order passed by the Joint Commissioner is in order. 6.. We have heard the rival submissions. The assessee, National Iron Traders is a dealer in iron scrap, having place of business at Coimbatore. The assessing officer revising the order already made and confirmed the turnover at Rs. 2,39,705.92 stating that the purchases made from Jayachandra Traders and Dinakar Traders are not genuine and are not entitled for exemption. Aggrieved by this order the assessee preferred appeal before the Appellate Assistant Commissioner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ra Traders with the address 13/56, West Thiruvenkatasamy Road, R.S. Puram, were recovered. From this report it is clear that in the address given by Jayachandra Traders at No. 13/56, West Thiruvenkatasamy Road, there is a business run by Jayachandran, S/o. Komarasamy Asari. The inspecting officers have not probed further and not taken any statement from the said Jayachandran with regard to his dealings. From the inspection report it is clear that Jayachandra Traders is carrying on business in selling scrap and it is for the department to take action against him. It was pointed out that the R.C. number of Jayachandra Traders in fact relates to some hotel dealer who had already closed his business. However, the assessing officer has stated th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le effected by an assessee is not a first sale, which is only taxable under the Tamil Nadu General Sales Tax Act, 1959, then under the provisions of the Act that sale cannot be brought within the net of taxation and it is for the Revenue to search out the first seller and levy tax on the first sale. It is not for the assessee, who is the subsequent seller, to show that the first sale has been taxed. The onus on the subsequent seller is only to point out that there has been a first sale and the onus is not on him to show that the first sale has, in fact, suffered tax. 9.. In [1984] 57 STC 137 in the case of State of Tamil Nadu v. C.K. Gajapathy and Co., this Court held that if the assessee was able to show that there had been merely a taxa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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