MAHARAJ MAL HANS RAJ Vs. STATE OF PUNJAB

JUDGEMENT

(1.) THE Sales Tax Tribunal, Punjab, Chandigarh, has referred the following two questions of law to us for our opinion : (1) Whether, on the facts and circumstances of the case, the applicant was not entitled in law to claim deductions under Section 5 (2) (a) (ii) of the Act with respect to M/s. Kapoor Weaving Factory, Amritsar, and M/s. Laxmi Trading Company, Amritsar, amounting to Rs. 4,01,690? (2) Whether the considerations and factors relied upon by the Tribunal in rejecting the deductions of M/s. Kapoor Weaving Factory, Amritsar, and M/s. Laxmi Trading Company, Amritsar, are relevant in law for disallowing deductions claimed ?

(2.) THE assessee is a registered dealer under the Punjab General Sales Tax Act as well as under the Central Sales Tax Act. On 8th December, 1969, the Assessing Authority framed the assessment for the year 1965-66 against the assessee. The assessee had claimed deductions under Section 5 (2) (a) (ii) with respect to two firms, namely, M/s. Kapoor Weaving Factory, Amritsar, and M/s. Laxmi Trading Company, Amritsar, in respect of five transactions of sale aggregating to Rs. 2,80,531 in favour of M/s. Kapoor Weaving Factory, Amritsar, and one sale transaction in the sum of Rs. 1,11,159 to M/s. Laxmi Trading Company, Amritsar. Both these firms were holding valid registration certificates for the relevant assessment year. The Assessing Authority came to the conclusion that these sales amounting to Rs. 4,01,690 had not in fact been made in favour of these two registered dealers. As a consequence of this finding, the Assessing Authority added this amount in the taxable quantum of the dealer.

(3.) FEELING dissatisfied against the order passed by the Assessing Authority, the assessee filed an appeal before the Deputy Excise and Taxation Commissioner (Appeals), Jullundur, who dismissed the same on 19th November, 1970. The second appeal filed by the assessee before the Sales Tax Tribunal was also dismissed on 16th September, 1972, While dismissing the appeals, the Tribunal observed as under: The fact that two alleged purchasing dealers stood registered at the relevant time is not in dispute. The appellant also furnished declaration forms which according to them were filled in and signed by the two purchasing dealers. But these contentions did not find favour because of the following facts : (i) Shri Laxmi Narain appeared to be managing the two concerns in his capacity as the sole proprietor or a partner. (ii) The person who was said to have furnished the affidavits was not duly identified by any person. (iii) One of the signatures was in English script while the other signature was in landa script. Both the affidavits were attested on one and the same date. (iv) The appellants had been given a number of opportunities to produce the purchasing dealers but had failed to produce them. (v) Cash payments were made in respect of all the transactions.