RAMJI DASS OM PARKASH Vs. PUNJAB STATE

JUDGEMENT

(1.) THIS is a reference by the Financial Commissioner under Sub-section (4) of Section 22 of the Pepsu General Sales Tax Ordinance, 2006 Bk. (No. 33 of 2006 Bk. ).

(2.) THE facts briefly stated are as follows: The petitioner-firm, Messrs Ramji Das Om Parkash, carries on business of hardware merchants at Mandi Gobindgarh which is in the erstwhile Pepsu State. The petitioner-firm filed its business return before the Sales Tax Assessing Authority for the year 1949-50 giving its gross turnover at Rs. 7,805, on 23rd of July, 1950. The return was, however, not accepted and the assessee was asked to produce evidence on 21st of September, 1950. However, on that Very day, i. e. , 23rd July, 1950, the Assessing Authority received secret information that huge stocks of iron material were concealed by the assessee in different places in Mandi Gobindgarh. In pursuance of this, the Assessing Authority, accompanied by an Inspector, went to various places where the assessee was supposed to have concealed the stock and actually found considerable quantity of galvanized sheets in a building known as Drug House at Gobindgarh and Anr. quantity of such sheets and iron material weighing something like 500maunds at house No. 287, and iron material weighing 600 maunds in house No. 254 and 1800 maunds in the house of one Nand Lal, goldsmith, all at Gobindgarh. The ownership of the stocks, so found, was denied by the firm and at a later stage an affidavit of one Om Parkash of Ludhiana was submitted to the effect that the Drug House, in which huge stocks of galvanized sheets were noticed, had been taken on rent by the aforesaid Om Parkash through the assessee-firm on a monthly rent of Rs. 10. It was further indicated that the Drug House was vacated on 1st of August, 1950. Despite several adjournments granted to the firm, this Om Parkash was not produced before the Assessing Authority. The Assessing Authority, taking into consideration the failure of the assessee-firm to produce Om Parkash and to substantiate the position taken by it that the house had been taken on rent by Om Parkash through the assessee-firm, the statement of Bhag Singh Chaukidar of the Drug House as well as the statement of the present owner of the house, Dr. Shankar Dutt, came to the conclusion that the stocks that were seen at various places did belong to the assessee-firm. Taking into consideration the value of the stocks, so discovered and fixing their price at Rs. 1,80,000, the conclusion arrived at by the Assessing Authority was that the annual gross turnover of the assessee-firm must be about Rs. 2,50,000. As the period under assessment was only 4 1/2 months, the turnover for this period was taken at Rs. 1,00,000. The firm was consequently assessed at Rs. . 3,125. The appeal filed before the Deputy Commissioner of Sales Tax was accepted and the declared turnover of Rs. 7,805 was accepted. Whereas' the order of the Assessing Authority is a detailed one, covering about 10 typed pages, the Appellate Authority' wrote a short 1 1/2 page judgment and the grounds taken in accepting the appeal do not appear to be very convincing. The Excise and Taxation Commissioner, suo motu acting under Section 21 of the Ordinance aforesaid-, set aside the appellate order and restored that of the Assessing Authority. Inter alia, the Commissioner was of the opinion that -. (1) the report of Shri Punjab Ratan was brushed aside as based on hearsay. This is wrong, keeping in view of the fact that he had himself gone to the spot and his report is based on the facts seen by him and that this officer bore no grudge against the assessee; (2) the Appellate Authority failed to notice that the statement of Bhagh Singh Chaukidar of the Drug House was recorded on 10th of April, 1951, and the same is full of contradictions and falsehood and that his statement could not be relied upon; (3) the statement of Balu Ram of the firm Baluram Harnam Singh recorded by Shri Punjab Rattan had mysteriously disappeared from the file and this could not be without the active connivance of the assessee-firm; and that, in any case, the statement of Mukandi Lal, Munim of Balu Ram Harnam Das, clearly established that the iron goods discovered at various places belonged to the assessee-firm; (4) Shankar Dutt, the present owner of the Drug 'house had clearly, mentioned that the persons, whose, goods were lying in the Drug House, belonged to Gobindgarh.

(3.) BEING aggrieved by this order, the assessee-firm moved the Financial Commissioner, in the exercise of his revisional powers under Section 21. This revision was dismissed on 6th of July, 1957, on the ground that the same was barred by time having been filed more than 90 days after the order of the Excise and Taxation Commissioner, and the Financial Commissioner further observed that there was no question of law involved in the present case. The application made to the Financial Commissioner for referring the point of law under Section 22 was dismissed, but, on directions being issued under Sub-section (4) of Section 22 by this Court, in General Sales Tax Case No. . 3 of 1958, dated 2nd of December, 1960, the following two questions have been referred to this Court by the Financial Commissioner : -. (1) Whether, on the facts and in the circumstances of this case, the revision application of the applicant could have been dismissed as barred by time ? (2) Whether, on the facts and in the circumstances of this case, no question of law arose out of the order of the Excise and Taxation Commissioner ?