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TMI Blog1981 (5) TMI 130X X X X Extracts X X X X X X X X Extracts X X X X ..... s at ₹ 52,585/-. That claim had not been accepted by the assessing and the appellate authorities on the ground that the asessee had not produced Form III-C in support F there of. Before the Additional Judge (Revisions) a certificate of the Sales Tax Officer showing that the business of ₹ 47,820/- had already suffered tax. was filed. The Additional Judge (Revisions) accepted the same and on its basis held that the assessee was not liable to tax at one percent. The Department has filed this revision challenging these findings of the Revising Authority. 2. It has been contended that exemption under Section 3-D (1) of the Act could not have been allowed in respect of purchases of foodgrains at ₹ 52,585/- in the absence of production of the necessary Form III-C ; that the liability to tax in respect of the amount of ₹ 4,765/- was at four percent and not at one percent and lastly that the Additional Judge (Revisions) erred in holding that Mahuwa is a flower and it is only with effect from 1-12-1973 that Mahuwa flower became taxable at multiple point at the rate of 3 1/2%. 3. I may first take up the last contention No finding has been given by the Additional Jud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ses in question are proved not to be the first purchases. Explanation II. - For purposes of this sub-section in relation to purchases, of foodgrains in pursuance of any order made under Section 3 of the Essential Commodities Act, 1955 including any purchases in. excess of the levy share, the purchase first made by a dealer from the State Government or its purchasing agents shall be the first purchase of such foodgrains and the tax shall accordingly be levied on that point on such dealer. 7. (a) Every purchase within Uttar Pradesh by a dealer, either directly or through another, whether on his own account or on account of any one else, shall for the purposes of clause (b) of sub-section (1) be deemed to be the first purchase, unless, the dealer proves otherwise to the satisfaction of the assessing authority after having furnished such declaration or certificate, obtained from the selling dealer, in such form and manner and within such period as may be prescribed. (b) Every sale within Uttar Pradesh by a dealer, either directly or through another, whether on his own account or on account of anyone else, shall, for the purposes of sub-section (2,), be deemed to be a sale to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation to or designation of the offence." 8. Similarly in "Words and Phrases", Permanent Edition, Volume II page 478 various senses in which this word has been understood have been given. One such sense is that the word "deemed" is the equivalent of "considered" or "adjudged", and whatever an act requires to be deemed or taken as true of any person or thing must in law be considered as having been duly considered or adjudged, and have full force and effect accordingly. If an Act of Parliament says that a person is to be deemed to be in any particular capacity, that must be understood to mean that he is thereafter taken as actually the very person that he is deemed to be, Wolton v. Govin, 16 QBD 43, 81. This expression has come up for consideration before different High Courts and the Supreme Court in connection with different statutes. In Dattu Apparao Machale and others v. Digambar Govindrao Shendge, AIR 1968 Bombay 361, it was observed that a deeming provision creates a fiction and lays down that something is, what it is not. 9. In Commissioner of Income Tax v. Bombay Trust Corporation, AIR 1930 PC 54, a foreign company had lent money ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es and the inevitable corollaries cannot be lost sight of. In other words, the legal fiction is to be taken to its logical conclusion. 13. As for the general principles which may enable a Court to find out whether a rule is mandatory or directory reference may be made to a recent decision of the Supreme Court in Sharif Uddin v Abdul Gani, AIR 1980 SC 303. It has been observed : "The difference between a mandatory rule and a directory rule is that while the former must be strictly observed, in the case of the latter, substantial compliance may be sufficient to achieve the objects regarding which the rule is enacted. Certain broad propositions which can be deduced from several decisions of courts regarding the rules of construction that should be followed in determining whether a provision of law is directory or mandatory may be summarised thus : The fact that the statute uses the word 'shall' while laying down a duty is not conclusive on the question whether it is r andatory or directory provision. In order to find out the true character of the legislation, the Court has to ascertain the object which the provision of law in question is to subserve and its design and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uire a right, a benefit or a privilege, it is to be regarded as mandatory. In my opinion in order to resolve the controversy in question this particular test fully serves the purpose. Under subsection (7) clause (a) of Section 3-D, every purchase within Uttar Pradesh by a dealer, either directly or through another, whether on his own account or on account of any one else, shall for the purposes of clause (b) of sub-section (1), be deemed to be the first purchase. This is a deeming clause and, as explained above, the purchase aforesaid shall be deemed to be the first purchase irrespective of the fact whether it is actually so. However, in order to rebut this legal presumption it has been provided that the dealer may prove otherwise to the satisfaction of the assessing authority and the mode of proof as well is provided and it is by furnishing such declaration or certificate obtained from the selling dealer, in such form, manner and within such period, as may be prescribed. For this purpose necessary provisions have been made in Rule 12 B as has already been discussed above. In other words here there is a provision of law which requires the doing of a certain act in a certain manner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... should be the nature and mode of proof by which the dealer may establish that the sale made by him is not to the consumer. That has been left entirely to the choice of the dealer." 17. Coming to Rule 12-A, it was observed that it merely suggests a convenient mode to the selling dealer for proving that the goods have not been sold to the consumer. It provides for no more than that, and the certificate in Form III-A is one mode. According to his Lordship if a contrary view is accepted, then it will impose a restriction which was not contemplated by sub-section (2). Then it was observed : "It may have been a different matter if sub-section (2) had read "unless the dealer proves otherwise in the manner prescribed............", when it could have been legitimately contended that the only mode of proof available to the dealer was the mode prescribed in rule 12-A. But that, the Legislature did not enact." 18. In clause (a) of sub-section (7) of Section 3-D the Legislature has now made such a provision by sayiag "unless the dealer proves otherwise to the satisfaction of the assees ing authority after having furnished such declaration or certificate, obtain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er Section 5 (2) (a) (ii) of the Bengal Act, the observations of the Supreme Court in Kedarnath Jute Manufacturing Co. Ltd. (supra) do dot, in my opinion, apply to the case befoie us" (at page 319). 20. Support may also be taken for the view expressed by me above from a Division Bench decision of this Court in M/s. jeetmal Ram Gopal v. Additional Judge (Revisions), 1978 UPTC 390. It was held in that case : "Inasmuch as Section 3-D (7) creates a legal fiction which can be displaced by evidence of the type required by that provision, the onus lay upon the assessee to rebut that presumption. In the present case the assessee has failed to discharge that onus." Reference may also be made to Commissioner of Sales Tax v. M/s. Brij Mohan Das Lixman Das, 1979 UPTC 614 where the assessee making purchases of oil seeds in Uttar Pradesh filed a certificate from the selling dealer stating that the tax was already paid. That certificate was not relied upon and it was held that the certificate was not sufficient to discharge the onus that lay on the assessee under Section 3-D (7) to prove that he was not the first purchaser. 21. To conclude, therefore, the provision contained i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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