VITHALDAS AND CO Vs. STATE OF GUJARAT

JUDGEMENT

(1.) AT the instance of the assessee, the Gujarat Sales Tax Tribunal, Ahmedabad, has referred the following question to us for our opinion under section 69 (2) of the Gujarat Sales Tax Act, 1969 (hereinafter referred to as "the Gujarat Act"), read with section 9 (2) of the Central Sales Tax Act, 1956 (hereinafter referred to as "the Central Act") : " Whether, in the facts and circumstances of the case, the Tribunal was justified in holding that the applicant was not justified to claim exemption on the sale of Rs. 11,32,257 under section 10 of the Central Sales Tax (Amendment) Act, 1969 ?"

(2.) THE aforesaid question has been referred to us on the facts and in the circumstances stated hereinunder : THE assessee, a partnership firm, is a dealer in cotton waste. It was duly registered under the Bombay Sales Tax Act, 1959, as well as under the Central Act. During the period of assessment made under the Central Act, commencing from 18th July, 1968, to 31st March, 1969, the assessee had effected inter-State sales to tune of Rs. 12,04,287. Out of these sales, no amount of tax was collected on the sales of Rs. 11,32,259 under the Central Act. However, in respect of the remaining sales of Rs. 72,029 the amount of tax at the rate of 3 per cent was separately collected and paid along with the returns. In the quarterly returns filed for the respective quarters commencing from 18th July to 30th September, 1968, 1st October, 1968, to 31st December, 1968, and 1st January, 1969, to 31st March, 1969, the sales on which no amount of tax was separately collected were shown as free of tax and consequently no amount of tax was paid on these sales along with the returns. At the stage of assessment, the assessee claimed that these sales of Rs. 11,32,259 were not liable to tax under section 10 (1) of the Central Sales Tax (Amendment) Act, 1969 (hereinafter referred to as "the Central Amendment Act"), on the ground that there was no tax liability in respect of these sales as prescribed under section 10 of the Central Amendment Act. It should be noted at this stage that the assessee had produced before the Sales Tax Officer at the time of assessment declarations in form C in respect of the aforesaid sales of Rs. 11,32,259 having found that the Sales Tax Officer was inclined to subject these sales to tax at 10 per cent. THE claim of the assessee was, however, negatived by the Sales Tax Officer, who found that inasmuch as the assessee had obtained declarations in respect of the sales effected in the course of inter-State trade and commerce and, therefore, though in the quarterly returns the assessee claimed these sales as exempted from the tax liability and no tax was paid on account thereof, nevertheless the prices at which the goods were sold were inclusive of tax and, therefore, the sales in question were liable to be subjected to tax at 3 per cent because the declarations in form C were produced in respect of these sales.

(3.) A reference was sought by the assessee under section 69 (1) of the Gujarat Act read with section 9 (2) of the Central Act that the Tribunal should refer the following questions to this Court for its advice : " (1) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the applicant has not discharged its burden of proving that non-collection of tax on the sales of Rs. 11,32,257 in the course of inter-State trade and commerce was on the ground that it could not be levied or collected ? (2) Whether, on the facts and in the circumstances of the case, the findings of the Tribunal that the story of the applicant that the declarations in form C were obtained by it in 1973 appears to be false; is vitiated being perverse and without taking into account the relevant documentary evidence and facts ? (3) Whether, on the facts and in the circumstances of the case, the findings of the Tribunal to the effect that the applicant could not get declarations in form C in respect of sales to Ajudhia Textiles Corporation relating to the period of assessment as the record of the mills were spoiled in 1971 and could not be available in 1973; is vitiated for not taking into account the relevant facts and documents ? (4) Whether, on the facts and in the circumstances of the case, the Tribunal was justified in holding that the applicant was not entitled to claim exemption on the sales of Rs. 11,32,257 under section 10 of the Central Sales Tax (Amendment) Act, 1969 ?"