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TMI Blog2002 (1) TMI 1281X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 and, inter alia, carries on the business of manufacture, sale and export of garments and is a reseller of dyes and chemicals. 3.. For the abovesaid period from September 1, 1978 to August 31, 1979, the petitioners had filed their returns under the provisions of the BST Act and also under the Central Sales Tax Act, 1956 (hereafter referred to as "the CST Act", for short) and the assessment under both the Acts were passed on March 29, 1982. In the assessment order under the CST Act (exhibit "B" to the petition) sales by transfer of documents before the goods crossed customs frontiers were allowed at Rs. 62,35,943 under section 5 of the CST Act. In the assessment order under the BST Act (exhibit A to the petition) sales under section 75 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and the petitioners have not preserved the books, except ledger and cash book, it was submitted that the petitioners will be seriously prejudiced if the impugned notice is allowed to be proceeded with. 6.. Under section 35(1) of the BST Act, an assessment can be reopened, if the assessing officer has reason to believe that any turnover of sales or turnover of purchases has escaped the assessment or has been under-assessed within a period of 5 years from the end of that the assessment year. Section 35(1)(b) provides that the assessment can be reopened within the extended period of 8 years if the assessing officer has reason to believe that the dealer has concealed such sales or purchases or has knowingly furnished inaccurate returns. 7. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the affidavit-in-reply filed by M.H. Vatnani, the Assistant Commissioner of Sales Tax (Assessment) on November 21, 1987 it was stated in para 3 that the assessing officer had reason to believe that the assessee has knowingly furnished incorrect returns because during the course of raid in February, 1983 the petitioner had admitted to have dealing with bogus parties and had admitted their liability in respect of a part of their dealings for the assessment year 1978-79. It was also stated in the affidavit-in-reply that the audit party had raised serious objections to the deductions given under section 5(2) of the CST Act, 1956 as the petitioners had not produced proof of transfer of documents before the imported goods crossed customs fronti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cuments of high seas sales available it is seen that deduction of high seas sales under section 5(2) of the Central Sales Act, 1956 was wrongly allowed to the extent of Rs. 62,35,943. Hence notice in F-28 issued calling the dealer on August 24, 1987." Sd/- (A.C.) 12.. From the aforesaid facts, it is abundantly clear that the assessment order passed on March 29, 1982 for the period September 1, 1978 to August 31, 1979, was reopened in 1987 because on scrutiny of the case records and documents, the assessing officer was of the opinion that the deduction of high seas sales given under section 5(2) of the CST Act, 1956 was wrongly allowed. Under section 35 of the BST Act, an assessment could be reopened only if the assessing officer has r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e petitioners. However, in view of the contentions raised by the respondents in their affidavit to the effect that on account of the doubts about the allowability of the deduction under section 5(2) of the CST Act, 1956, the assessment is being reopened we may refer to the decision of the Gujarat High Court, which has been relied upon by Mr. Jetly reported in [2000] 120 STC 510 (Crompton Greaves Ltd. v. State of Gujarat). In that case, while dealing with Gujarat Sales Tax Act, 1969, wherein the provisions are similar to the BST Act, 1959 it was held that if the conditions precedent for invoking the jurisdiction after 5 years are not fulfilled, then the reassessment would be invalid. It was further noted in the said judgment that the words ..... X X X X Extracts X X X X X X X X Extracts X X X X
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