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TMI Blog2019 (3) TMI 407X X X X Extracts X X X X X X X X Extracts X X X X ..... ked within the time stipulated under Section 12-A of the TNGST Act - Admittedly, in the instant case, the Assessing Officer did no enquiry to ascertain the prevailing market price of Oxygen at the relevant time. The assessment has been completed solely based upon the price of gas sold by the petitioner as recorded in their books of accounts. Therefore, we are of the view that unless there was a comparison with the prevailing market price and then the Assessing Officer is satisfied that the price shown in the books of accounts of the dealer was abnormally low compared to the prevailing market price and this was with a view to evade payment of tax, then alone, Section 12-A could have been invoked. There is a marked distinction between the power exercisable under Section 16 and Section 12-A of the TNGST Act. In the case on hand, the Assessing Officer has gone only by the difference in price of the gas sold by the petitioner/dealer and there is nothing on record to indicate that the petitioner/dealer had collected more than what was shown in their books of accounts - Therefore, unless the twin tests stipulated in Section 12-A were satisfied, the question of invoking the same would n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Appellate Assistant Commissioner has wrongly shifted the burden to the State which is perverse. 3.With the consent of the learned counsels for the parties, T.C.(R) No.60 of 2015 is taken as the lead case. 4.The petitioner, a dealer in industrial oxygen and medical gases, is carrying on business in Coimbatore within the jurisdiction of the Commercial Tax Officer, Thudiyalur Assessment Circle. 5.An inspection was conducted in the place of business of the petitioner/dealer and certain defects were pointed out. The defects which are concerned in these tax case revisions are with regard to the rates of Oxygen gas, which was sold by the petitioner/dealer to different dealers. According to the books of accounts maintained by the petitioner/dealer, the higher rate was ₹ 28 per cubic meter, whereas, the lowest was ₹ 10 per cubic meter, and therefore, the Assessing Officer was of the view that it is an intention to evade payment of duty, and accordingly, issued notice calling upon the petitioner to file objections on or before 26.07.2005. The petitioner/dealer filed their objections stating as to why differential rates were adopted by them in the sale of Oxygen. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (1) If the assessing authority is satisfied that a dealer as, with a view to evade the payment of tax, shown in his accounts, sales or purchases of any goods, at prices which are abnormally low compared to the prevailing market price of such goods, it may, at any time within a period of five years from the expiry of the year to which the tax relates, assess or reassess the dealer to the best of its judgement on the turnover of such sales or purchases after making such enquiry as it may consider necessary and after giving the dealer a reasonable opportunity to show cause against such assessment. 10.A reading of the above provision shows that there are principally two elements which are required, which the Assessing Officer has to be satisfied while invoking the power under Section 12-A of the TNGST Act; first of which being that there is an intention on the part of the petitioner/dealer to evade payment of tax and for such intention, if he had shown that the sale prices are at abnormally lower rates compared to the prevailing market price of such goods, the power can be invoked; and secondly, the power can be invoked within the time stipulated under Section 12-A of the TNGST ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... order of assessment dated 29.07.2005, has referred to the explanation offered by the dealer as to why differential price was adopted. 15.In sum and substance, the contention was that the price varies based on purity, size of the cylinders, nature of operation in which the purchaser is engaged when cylinder is brought by the customer for filling up of the case, when the petitioner/dealer sells the gas along with their cylinders etc. Apart from that, the petitioner specifically pointed out the name of three suppliers in Coimbatore, one of whom was an assessee on the file of the Commercial Tax Officer, Thudiyalur Assessment Circle and stated that they also charged on the same line. Therefore, the Assessing Officer if wants to reject the stand taken by the petitioner, ought to have made an enquiry in this regard. Unfortunately, the Assessing Officer by a cryptic order, rejected the objections. The first appellate authority has carefully analysed the explanation offered by the dealer and found that the best judgment assessment on the alleged assessment was wholly unsustainable. 16.In the decision of the High Court of Kerala in the case of Deputy Commissioner of Sales Tax (La ..... X X X X Extracts X X X X X X X X Extracts X X X X
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