SANJIB BOTHRA Vs. DEPUTY COMMISSIONER OF COMMERCIAL TAXES

JUDGEMENT

(1.) IN this application under Section 8 of the West Bengal Taxation Tribunal Act, 1987 the petitioner Sanjib Bothra, proprietor of M/s. Arbeits (India) claiming to be dealer registered under both West Bengal Sales Tax Act, 1994 and the Central Sales Tax Act, 1956, challenges the order passed by the West Bengal Commercial Tax Appellate and Revisional Board on September 3, 2003 in the revisional case No. 690/02 -03 refusing to interfere with the order of the appellate authority passed on April 1, 2002 in the appeal case No. A -124/BE/2001 -02 upholding the levy of purchase tax on TSPP of Rs. 18,08,23,778 and on Rs. 5,24,36,421. The fact as stated in the petition in short is this. The petitioner's request for deduction under Section 20 (3)(b) of the West Bengal Sales Tax Act, 1994 for the sale on export under agreement and/or arrangement to foreign buyer of industrial leather gloves with different names namely (i) driving gloves, (ii) Canadian gloves and (iii) welding gloves of different brand names like cow grain Canadian and chrome Canadian and the assessing officer levied purchase tax both under clauses (a) and (a) of the Section 13(1) of the West Bengal Sales Tax Act, 1994. On appeal the order of levy of purchase tax under the aforesaid Clause (c) was set aside but the same under Clause (c) as aforesaid was confirmed. The Revisional Board on revision affirmed the aforesaid order of the appellate authority though in an earlier application of the petitioner for the fourth quarter ended on March 31, 1998 on similar fact was remanded by the board. On reassessment as per order of the Revisional Board for the fourth quarter ended on March 31, 1998 as well as in the next assessment for the fourth quarter ended on March 31, 2000 and March 31, 2001 on similar fact the deduction as aforesaid were allowed. On being aggrieved with the impugned order of the Revisional Board this application was filed for setting aside the impugned order of purchase tax under Section 13(1)(a) for the assessment period of fourth quarter ended on March 31, 1999 on the ground inter alia that the Revisional Board failed to appreciate the documents produced by the petitioner and such failure resulted in appreciation of fact and law. The board failed to appreciate that the brand names cow -grain Canadian and chrome grain Canadian are brand names of same goods.

(2.) THE respondents though did not file affidavit -in -opposition, contested the petition with submission that the petitioner failed to discharge his burden under Section 13(2) of the West Bengal Sales Tax Act, 1994 which provides that the burden of proving that any purchase effected by a dealer is not liable to tax under Sub -section (1) of Section 13 shall be on such dealer. The only point for consideration is whether the petitioner discharged his burden under Section 13(2) of the West Bengal Sales Tax Act, 1994.

(3.) THE aforesaid observation of the assessing officer was questioned by the petitioner. From the impugned order of the appellate authority, it appeared that the petitioner produced the documents for appreciation of his case. While upholding the impugned order of the assessing officer the appellate authority observed, "purchase orders placed on the local suppliers which were produced at this stage, did not at all go to prove that the purchases were for the purpose of export out of the territory of India," I do not think that the purchase orders, as placed by the petitioner under the local suppliers, the invoices and bills should have disclosed the "purpose of purchase". The assessing officer disbelieved the orders for purchase due to discrepancies as pointed out and also the purchase from Lokenath Enterprise on the ground that on inspection by the Inspector, the business institution had not been traced out. I am of opinion that the discrepancies in the order of purchase are immaterial if the purchases were actual. In all the cases amount of purchases were big and the same might have been paid by account payee cheques. The petitioner could have been given opportunity to prove the actual transactions with the proof of payments by account payee cheques but neither the petitioner did nor the petitioner was asked to do it. As regards non -existence of M/s. Lokenath Enterprise, a notice could have been issued for its appearance with trade licence and other documents of its business and the petitioner could be given opportunity to prove the existence of M/s. Lokenath Enterprise. But none of the authorities below thought of it to be done. The Revisional Board while upholding the order of the appellate authority observed, "the petitioner also failed to produce any documents in support of the submission that the petitioner has purchased those goods from local dealers in compliance with the agreement so entered into between the petitioner and the foreign buyers. Apart from those in a set of papers so submitted by the petitioner in invoice No. 1105 of 1998 -99 dated April 27, 1998 the description in the same inter alia, are for sale of industrial leather gloves, in the corresponding purchase bill and challans so produced do not find any such mention of the goods that the petitioner has purchased industrial leather gloves. The discrepancy in the purchase bills are about purchase of 'Chrome Canadian'. The same and similar description and discrepancy also found in any other documents so produced by the petitioner". The Clause (a) of Section 13(1) provides, "every dealer, who is liable to pay tax under Sub -section (3) of Section 27 and who is registered, shall, in addition to the tax payable under any other provisions of this Act, be also liable to pay tax under this Act on all his purchases from - -a dealer, who is not registered, of goods, other than gold, rice, wheat, raw jute, dry chilli produced in West Bengal, silk fabric made or manufactured in West Bengal, intended for direct use in the manufacture in West Bengal of goods for sale by him, and of containers and other materials for the packing of goods so purchased or manufactured". Section 20(2) of the West Bengal Sales Tax Act, 1994 provides that the tax payable by dealer liable to pay tax under Section 13 shall be levied on his taxable specified purchase price. The Section 20(3)(b) provides that the expression "taxable specified purchase price" as aforesaid means that part of the specified price payable or paid which remains after deduction therefrom the specified purchase price payable or paid on the purchase of goods which are shown to the satisfaction of the commercial tax department official to have taken place in the course of export of the goods out of the territory of India within the meaning of Section 5 of the Central Sales Tax Act, 1956. Both the appellate authority and the revisional authority observed that the purchase was not proved to have been in compliance with the prior agreement for exemption under Section 20(3)(b) of the WBST Act, 1994. The compliance with the provision of Section 5(3) of the Central Sales Tax Act, 1956 is a must and this provision required satisfaction of Commercial tax department official that such purchase of the goods took place after the agreement or order for or in relation to the export and such purchase took place for the purpose of compliance with such agreement or order entered into with the foreign buyers. In para 10 of the petition the petitioner asserted that there had been such agreement and/or orders for export before purchase. This fact as affirmed by the petitioner on affidavit is not denied by the respondent specifically. The impugned orders are also silent about any evidence on this fact. The petitioner annexed a letter dated December 4, 2003 issued by the Council for Leather Export which shows that the cowgrain Canadian and chrome Canadian are the same types of leather and gloves and are under the category of industrial leather handgloves