ESWARA OIL COMPANY Vs. STATE OF ANDHRA PRADESH

JUDGEMENT

(1.) The petitioner is a dealer in groundnut oil, engine oil and other goods, at Narsaraopet in Guntur District. For the month of June, 1974, it filed a return in form A-2 disclosing a turnover of Rs. 4,06,047.97 and claimed exemption on the entire turnover. Out of this gross turnover, a sum of Rs. 1,16,324.83 related to the sales of groundnut oil. Exemption was claimed on this turnover as second sales in the hands of the petitioner. Subsequently, it was detected by the Commercial Tax Officer, Narsaraopet, that a certain quantity claimed to have been purchased by the petitioner from one Kotha Venkateswara Rao of Rajahmundry, was a bogus claim and that the petitioner had merely obtained a bill without purchasing the goods from such person. The amount covered by the bill was Rs. 31,934.38. Since the petitioner could not satisfy the Commercial Tax Officer about the genuineness of the said purchase (claimed to have been made by it from Kotha Venkateswara Rao of Rajahmundry), the Commercial Tax Officer determined the net turnover at Rs. 35,127.81 (adding 5 per cent towards profit) by his provisional assessment order. In the annual return, however, the petitioner did not persist in its claim for exemption for the said amount of turnover.

(2.) Proceedings were taken against the petitioner under section 7-A(2) of the Andhra Pradesh General Sales Tax Act, in respect of the aforesaid false claim, and penalty in an amount three times the tax due was levied. This penalty has been affirmed by the Appellate Tribunal.

(3.) In this tax revision case, it is contended by Sri S. R. Ashok, the learned counsel for the petitioner (assessee), that the bill said to have been obtained by the petitioner from Sri Kotha Venkateswara Rao of Rajahmundry, was admittedly not produced before the assessing authority. Even form E prescribed by the Rules was not filed by the petitioner claiming exemption. In such a case, it is contended, section 7-A(2) of the Act is not at all attracted, and no penalty could have been levied.