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TMI Blog1998 (12) TMI 625X X X X Extracts X X X X X X X X Extracts X X X X ..... sel for the revisionist and Sri Prakash Krishna, learned Counsel for the respondent. 3. The first two questions raised in this revision petition are as under : "Whether on the facts and under the circumstances of the case the Sales Tax Tribunal as legally justified to drastically reduce the taxable turnover as fixed by the assessing authority despite the fact that adverse Materials found on the survey dated 12.2.1990 and incriminating evidences on record indicate large scale suppression of tax by the dealer? Whether the Sales Tax Tribunal was legally justified in exempting the turnover of first purchase of goods notified under Section 3-D in the State and allegedly despatched to his Ex. U.P. principal by applying the ratio of C.S.T. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and were not liable to tax under the U.P. Sales Tax Act. This view has since been affirmed by the Hon'ble Supreme Court in C.S.T. v. Bakhtawan Lal Kailash Chand, 1992 U.P.T.C. 971 : A.I.R. 1992 S.C. 1952. The case of the respondent was entirely different. Its case was that there was no purchase or sale within the State of U.P. and the goods were despatched to Ex-U.P. dealers for sale. In the grounds of appeal before the Tribunal, it was stated by the dealer respondent as under : "Because the applicant besides carrying on dal and rice manufacturing business also carried on Arat business on behalf of agriculturists (farmers). The modus operandi is that the farmers brought agriculture produces (own cultivated) on their agriculture ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Tribunal. The Tribunal held that since the dealer held an eligibility certificate, it suffered from a misconception that the purchases of raw materials were also exempt from tax and that to remove this misconception the dealer applied to the Commissioner under Section 35 for his opinion. Therefore, the taxibility of the purchases was disputed and the non-deposit of tax will be considered to be bona fide and hence no interest could be charged. Section 8(1) of the Act stands as under : "8. Payment and recovery of tax. - (1) The tax admittedly payable shall be deposited within the time prescribed or by the thirty-first day of August, 1975, whichever is later, failing which simple interest at the rate of two per cent per mensem sha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... O., 1994 U.P.T.C. 893, the Hon'ble Supreme Court while dealing with a somewhat similar provision in Section 11-B of the Rajasthan Sales Tax Act, held that if the assessee pays the tax which according to him is due on the basis of information supplied in the return filed by him, there would be no default on his part to meet his statutory obligation. The Hon. Supreme Court further observed that it is difficult on the plain language of the Section to hold that the law envisages the assessee to predicate the final assessment and expect him to pay the tax on that basis to avoid the liability to pay the interest. 8. In C.S.T. v. Qureshi Crucible Centre, 1993 U.P.T.C. 901, the Hon'ble Supreme Court dealt with the provision of Section 8 (1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tics Ltd. Here, nobody had doubt that if Section 6-B of the Act was valid tax was payable on the turnover. It was the constitutional validity of Section 6-B which was challenged by the appellants in the earlier writ petition before the Calcutta High Court and which finally ended up in upholding of its validity. Hence, there was no question of the assessee waiting for the determination of the turnover as there was no dispute on that aspect. The fact that appellant questioned the constitutional validity of the charging provision cannot be equated with a dispute whether the freight paid would also form part of the sale amount. It was a highly debated dispute whether price amount would envelope the freight charges paid by the dealer and until t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the dealer is frivolous or is not bona fide, interest has to be paid. 11. In the present case, it was not indispute that the purchases of unsplit pulses are liable to purchases tax. The dealer admitted to have made purchases. Its case was that since it held an eligibility certificate issued under Section 4-A of the Act by virtue of which the sales of goods manufactured by it were exempt from tax, the purchase of goods that were used as raw material for the manufacture of goods in respect of which the eligibility certificate was granted, is also exempt from tax. Exemptions under the Act are governed by the statutory provision. An eligibility certificate is issued under Section 4-A which clearly prescribes that the sales of goods manufact ..... X X X X Extracts X X X X X X X X Extracts X X X X
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