STATE OF TAMIL NADU Vs. ALAGGAR TRADERS

JUDGEMENT

(1.) THE Revenue is on revision against the order of the Tribunal made in Tribunal State Appeal No. 115/1999 in respect of Sri Alaggar Traders, dated 3. 10. 2001 by formulating the following Substantial Question of Law. " Whether the facts and circumstances of the case, the Tribunal is legally right in affirming the order of the First Appellate Authority in respect of allowance of the claim of second sale exemption even when the registration number of the socalled seller belonged to some other dealer ?

(2.) THE material facts for disposal of this revision are that the assessee is the dealer in Iron and Steel and assessee on the file of the Commercial Tax Officer, P. N. Palayam Circle, Coimbatore for the assessment year 1995-96. The assessee was originally assessed on a total and taxable turnover of Rs. 50,82,359/- and Rs. Nil. The assessment was over on 26. 2. 1997. It appears that on 20. 2. 1997, the Enforcement Wing Officers of the Commercial Tax Department caused an inspection on the business premises of the assessee and found that during the relevant year, there was a purchase on C. I. Scraps for Rs. 7,44,381/- from one Tvl. Sri Karpaga Vinayaga Traders, 38-A, Mahalakshmi Nagar, Kuniamuthur, Coimbatore. On subsequent verification, it was found that no such dealer is available in the said address. It was also found that the Registration Number of the said dealer relates to one Tvl. Kallazhagar Traders. On that basis, the Enforcement Wing Officers formed an opinion that the assessee produced the sale bills of non-existing dealer and obtained second sales exemption in respect of the entire turnover. The Assessing Officer on receipt of B3 Proposal from the Enforcement Wing Officers, called upon the assessee to file an objection, and issued a notice to the assessee for the purpose of revision of assessment on the above said ground. The Assessing Officer rejecting all the objections raised by the assessee, framed an assessment in levying of tax at 4% in a sum of Rs. 71,771/- and imposed a penalty at 150% under Section 16 (2) of the Tamil Nadu General Sales Tax Act (in short "the Act") in a sum of Rs. 1,07,657/ -. That revision order was set aside by the Appellate Assistant Commissioner on appeal at the instance of the assessee on the ground that the selling dealer had been registered with the Department with effect from 1994-95 and had renewed the Registration Certificate for the subsequent assessement years 1995-96 and 1996-97. Though the said dealer had not filed A1 monthly returns for these years, the Assessing Officer has not taken any steps to trace out this seller but treated them as a bill trader and assessed the appellant, which is contrary to various decisions of this Court. The Revenue's further appeal to the Tribunal was also dismissed on the ground that the Department has issued Form-XX Delivery Note to the selling dealer and the Registration Certificate was valid for the relevant assessement years. In that circumstances of the case, the burden of proof cast upon the assessee has been discharged and it is for the Revenue to proceed further in accordance with the statutory provision against those dealers, who have sold the goods. The correctness of the same is put in issue in this revision by formulating the question of law as aforesaid.

(3.) HEARD the learned Special Government Pleader (Taxes) for the petitioner and perused the materials on record.