GOPAL DAS Vs. ASSESSING OFFICER TRADE TAX

JUDGEMENT

(1.) THE present writ petition under Article 226 of the Constitution of India, the petitioner has prayed for quashing the notice under Section 21 of U.P. Trade Tax Act (hereinafter referred to as Act) dated 28.4.2000 for the first year 1995-96 (Annexure ? 5) to the writ petition.

(2.) THE brief facts of the case are as follows: - THE petitioner was a registered dealer under Section 8 ? A of the Act was engaged in the business of manufacture and sales of agricultural implements and house hold goods commonly known as Kharal (Imamdasta). During the course of assessment proceedings, petitioner disclosed total sales at Rs.1,30,25,142.25p and taxable sales at Rs.4,12218.90 within the State of U.P. and had not disclosed any interstate sales. THE total sale comprises sales of manufactured agricultural implements at Rs. 1,14,78,623.85p and U.P. purchased agricultural implements at Rs. 734691.00p sales of house hold goods ar Rs.1,49,971.90, sales of Iron Scrap at Rs. 2,62,309/-. Tax was admitted on the sales of house hold and sales of Iron Scrap. An assessment order was passed for the assessment year 1995-96 both under the U.P. Trade Tax Act as well as under the Central sales Tax Act by the Trade Tax Officer, Sector 13, Kanpur vide order dated 27.3.1997. While passing assessment order, Assessing Authority had considered the survey dated 14.9.1995 made by the S.T.O. (S.I.B.) and on the basis of the said survey and other material, books of account had been rejected and the turnover of the house hold Kharal had been estimated at Rs. 3 Lacs and the turnover of Iron Steel (Scrap) had been estimated at 6 Lacs. Assessing Authority, however, granted exemption on the turnover of manufactured agricultural implements and locally purchased agricultural implements for Rs.1,26,12,861.35p. Against the assessment order, petitioner filed appeal before the Deputy Commissioner (Appeal), Trade Tax, Kanpur. Appeal was allowed and the books of accounts and the disclosed turnover was accepted vide order dated 13.4.1995.

(3.) HEARD Sri M.Manglik, learned Counsel for the petitioner and Sri M.R. Jaiswal, learned Standing Counsel appearing on behalf of the respondent. Learned Counsel for the petitioner submitted that the survey dated 14.9.1995 had been considered by the Assessing Authority in detail while passing the assessment order dated 27.3.1997. He submitted that on consideration of the entire survey report, books of account had been rejected, but the turnover of self manufactured agricultural implements and the turnover of purchased agricultural implements had been exempted. In the Appellate order dated 13.4.1998 also the survey dated 14.9.1995 had been considered and the petitioner's books of account and the disclosed turnover have been accepted. He further submitted that in the order dated 18.3.1996 passed under Section 21 of the Act, Assessing Authority levied tax on the turnover of Iron Steel which is alleged to have not been used in the manufacturing of agricultural implements on the ground that the petitioner had not manufactured agricultural implements. The Appellate Aurthority whicle allowing the appeal vide order dated 30.11.1998 again considered the survey dated 14.9.1995 and accepted the claim of the petitioner about the manufacturing of the agricultural implements and accordingly, order of the Assessing Authority passed under Section 21 of the Act had been quashed. He submitted that in the notice same survey dated 14.9.1995 had been made basis which has been considered in detail in the assessment order under section 7 of the Act, appellate order under section 21 of the Act. Thus notice under Section 21 of the Act is wholly unwarranted. He submitted that the allegations of the Assessing Authority that the self manufactured Kharal (Imamdasta)o had been taxed as a house hold goods @ 7.5% while it should be taxed @ 10% as a Mill Store is also unwarranted, inasmuch as, it is only on account of change of opinion and there was no material on the basis of which, such view could be taken. He submitted that the notice under Section 21 of the Act had been issued on the basis of the same material which was available at the time of assessment proceedings and there was no fresh material on the basis of which a believed could be formed about the escaped assessment. He submitted that the notice was issued merely n the basis of change of opinion. Which is wholly unwarranted. In support of his contention, he relied upon the Division Bench decision of this Court in the case of Royal Trading Company Vs. reported in UPTC 2000 page 210 and the Division Bench decision in the case of M/S Ratan Industired Pvt. Ltd. Vs. Addl. Commissioner of Trade Tax reported in 2004UPTC page 347. Learned Standing Counsel submitted that the initiation of proceeding under Section 21 of the Act was wholly justified. He submitted that though, the survey dated 14.9.1995 was considered at the time of assessment proceedings, but it was considered fro rejecting the books of account and it has not been considered othat at the time of survey, manufacturing of agricultural implements was not found leading to the inference that no manufacturing of agricultural implement was carried on at all. He submitted that the self-manufactured Kharal is liable to tax as a Mill Store, while it had been wrongly assessed @ 7.5% as a house hold goods. In these circumstances, he submitted that the initiation of proceedings under Section 21 of the Act was justified. In Support of his contention, he relied upon the Division Bench decision of this Court in the case of reported in 2002 UPTC page 210 and 2003 UPTC page 140.