THAKKAR PRANJIVANDAS HARGOVINDAS Vs. STATE OF GUJARAT

JUDGEMENT

(1.) THE Gujarat Sales Tax Tribunal, Ahmedabad, has referred the following questions to this High Court under section 69 (1) of the Gujarat Sales Tax Act, 1969. 1. Whether, on the facts and in the circumstances of this case, the Tribunal was right in law in holding that the applicant was not entitled under section 8 (iii) of the Gujarat Sales Tax Act, 1969, to deduct from its turnover of sales, those sales which were effected to M/s. Lucky Trading Company against certificates issued in the prescribed form 17, on the ground that those certificates as signed and issued by Shri Bhagwandas Hirumal as the Manager of M/s. Lucky Trading Company, were unauthorised and, therefore, invalid because his name as the nominee was not entered in Part II of the statement attached to the licence issued in form No. 7 ?

(2.) WHETHER, on the facts and in the circumstances of this case, the Tribunal was right in law in holding that the applicant was not entitled to deduct under section 8 (iii) of the Gujarat Sales Tax Act, 1969, from its turnover of sales, those sales which were effected to M/s. Lucky Trading Company against certificates in form 17 as allegedly signed by its proprietor Shri Govindram Samatmal as the licensed dealer, and for that purpose in holding that his signature in Hindi in the certificates could not be compared for want of material on record and also because his full signature in English did not tally with the material available on record ?

(3.) WHETHER, on the facts and in the circumstances of this case, the Tribunal was right in law in holding that when a question arose as to whether certificates in question were genuine or not, the selling dealer like the applicant in the present case, could establish that fact by other evidence despite the fact that the purchasing licensed dealer had not entered the signature in Part I of the statement appended to the form of licence and in spite of the fact that he had not given his specimen Signatures to the department in prescribed form 10 ? 2. The first four questions have been referred by the Tribunal to this Court at the instance of the assessee, while the last question, viz. , the question No. 5 has been referred at the instance of the Revenue. 3. The assessee, M/s. Thakkar Pranjivan Harijivandas and Co. , is a wholesale dealer dealing in resale of edible oil at Ahmedabad. The total sales during the period of assessment were to the tune of Rs. 3,18,84,108, out of which, the sales amounting to Rs. 19,04,914 were claimed against declarations in form No. 17. According to the assessee, the abovesaid sales were effected to the dealer holding licence for the purpose of the seeds for the purpose of resale. Out of the abovesaid sales, the sales worth Rs. 9,54,450 were effected to M/s. Lucky Trading Company, which was holding registration certificate issued on May 15, 1970, effective from May 1, 1970. This dealer, viz. , Lucky Trading Company, was also holding a licence dated July 2, 1970. All the sales were duly supported by declaration form, i. e. , form No. 17. Anyhow, at the stage of assessment, the Sales Tax Officer had disallowed the claim of deduction against form No. 17 on various grounds. The Sales Tax Officer had taken the view that the sales in dispute were not admissible for deduction and that the declarations signed by the licensed dealer or the unauthorised nominee were not found to be genuine and, therefore, the assessee was not entitled to the deductions against form No. 17 as urged by the assessee. It appears that aggrieved with the abovesaid orders and also of the order of imposing penalty in a sum of Rs. 10,000, the assessee had carried the matter before the Assistant Commissioner who had also confirmed the conclusion arrived at by the Sales Tax Officer on the grounds stated in the detailed orders. It was the view taken by the Assistant Commissioner, Sales Tax, that the assessee was not entitled to the deductions against form No. 17 as claimed by it. Anyhow, the penalty amount of Rs. 10,000 came to be reduced to an amount of Rs. 1,000 only. Against the abovesaid orders passed by the Assistant Commissioner, Sales Tax, in, the first appeal, the assessee had approached the Tribunal by way of filing the second appeal. The second appeal filed by the assessee also came to be dismissed by the orders dated July 12, 1979. Later on the assessee had made necessary prayer for the reference of the abovesaid questions to this Court. As pointed out by us earlier, the last question has been referred by the Tribunal to this Court at the instance of the Revenue. 4. As noticed above the case of the assessee was that during the period of assessment the total sales turnover were to the tune of Rs. 3,18,84,108 out of which the sales amounting to Rs. 19,04,914 were claimed against the declarations in form No. 17. Anyhow, the questions with which we are concerned would relate to the sales worth Rs. 9,54,450 only which were effected to M/s. Lucky Trading Company. The Sales Tax Officer at the stage of assessment has disallowed the claim of the assessee for the deduction against form No. 17 on various grounds. The Tribunal has narrated the abovesaid grounds in extenso while delivering the orders, the detailed reference of which according to us is not necessary at this juncture. Anyhow, the Sales Tax Officer at the time of assessment had come to the conclusion that taking into consideration various facts and circumstances of the case, the declarations in form No. 17, could not have been accepted as genuine declaration. Not only this, but the Sales Tax Officer has gone to the extent of saying that the abovesaid transactions appear to be bogus and shady. 5. Going to the facts which have weighed before the sales tax authorities, it requires to be appreciated that one Govindram Samatmal had made the necessary application for registration on April 8, 1959, for carrying on the business in the name and style of M/s. Jolley Shoe Company. The address of the business given was of 83/1, Chokha Bazaar, Kalupur, Ahmedabad. In response to the application, registration certificate dated April 30, 1969, was issued in favour of Govindram Samatmal as proprietor of the business. One another application for the registration certificate came to be presented in the name of M/s. Lucky Trading Company, having a place of business at Devalali Bazaar, Kubernagar, Ahmedabad showing it as the additional place of business of Jolley Shoe Company. The nature of the business of the Jolley Shoe Company was to deal in the footwear, whereas the nature of business of M/s. Lucky Trading Company was shown as dealing in the edible oil and ghee. Govindram Samatmal had applied for licence on May 6, 1970 in the name of Jolley Shoe Company, in which M/s. Lucky Trading Company has been shown as an additional place of business. One Bhagwandas Hirumal had applied for the registration certificate for the business run in the name of M/s. Lucky Trading Company at Kubernagar, Devlali Bazaar, i. e. , in the same premises where the abovestated M/s. Lucky Trading Company was conducting its business. In response to this application, the registration certificate dated November 16, 1969, was issued. Moreover, one Vasudev Bulchand, who was doing the business in the name of Bhavani Traders at the same premises at which the abovesaid two Lucky Trading Companies are carrying on the business was also found to be operating. This business was issued the registration certificate on April 2, 1971. Therefore, the Sales Tax Officer at the time of assessment had taken into consideration this eloquent feature of the case that three concerns in the name of M/s. Lucky Trading Company holding different registration certificates were trading which in the eye of law were independent of each other. It was also noticed with great pertinence at the time of the assessment that though the abovesaid three business were in the name and style of M/s. Lucky Trading Company, different persons used to run the business and that the business differed and that the proprietorship of the business also differed.