CHHATTAR SINGH Vs. STATE OF HARYANA

JUDGEMENT

(1.) Challenge in this writ petition filed under articles 226/227 of the Constitution of India is to the orders dated July 19, 1994 (annexure P9), dated November 30, 1994 (annexure P11), dated February 7, 2000 (annexure P20) and dated July 17, 2000 (annexure P22). Put shortly, the facts necessary for adjudication of the instant petition as narrated therein are that petitioner No. 1 is a physically handicapped and is the sole proprietor of petitioner No. 2. He started his business of oil extraction in November, 1986 at village Sundrehti on individual basis to earn his livelihood with the help of petitioner No. 3. He was registered under the provisions of the Haryana General Sales Tax Act, 1973 (in short, "the Act") during the period he did his business till its closure in 1988-89 due to loss and poor financial position. Petitioner No. 3 being a close relative of petitioner No. 1 stood witness/guarantor for him before the Excise and Taxation Department for any kind of tax arrears. The said business was run by obtaining a small amount of loan from bank/financial institution through the help of petitioner No. 3 who was given General Power of Attorney (annexure P1). Petitioner No. 2 was given exemption from payment of tax on sale of oil manufactured by it under section 13B of the Act vide certificate dated November 5, 1986 (annexure P2) valid from November 4, 1986 to November 3, 1987 which was extended up to November 3, 1988. The gross turnover of the dealer for the assessment year 1988-89 was Rs. 1,52,908. The net profits, even if estimated, shall be about Rs. 16,000 per year at the rate of 10 per cent. During the assessment proceedings, notice dated January 13, 1993 (annexure P3) was issued to the dealer to explain as to why six entries mentioned in the notice had not been incorporated in the books of account. The dealer/petitioner No. 2 through petitioner No. 3 filed an affidavit dated January 13, 1993 (annexure P4) and pleaded that these goods were never sold by the petitioners and the dealer had no concern with these transactions. The assessing authority vide order dated March 22, 1993 (annexure P5) made an addition of Rs. 2,75,279 in the gross turnover and after taxing it at the rate of 10 per cent, raised a demand of Rs. 27,528. The penalty under section 48 of the Act amounting to Rs. 55,100 at the rate of 200 per cent, of the tax payable was also imposed. Thus, an additional demand of Rs. 82,628 was raised. Feeling aggrieved, the dealer filed an appeal (annexure P6) before the Joint Excise and Taxation Commissioner (Appeals) (for brevity, "the JETC (A)") who vide order dated September 28, 1993 (annexure P8) set aside the order of the assessing authority and remanded the matter for fresh decision after confronting with the material checked to the dealer and giving an opportunity to rebut the same. The assessing authority vide order dated July 19, 1994 (annexure P9) again raised the same demand. Still dissatisfied, the dealer filed an appeal (annexure P10) before the JETC (A). The JETC (A) vide order dated November 30, 1994 (annexure P11) dismissed the appeal against which the dealer filed an appeal (annexure P12) before the Sales Tax Tribunal, Haryana (hereinafter referred to as "the Tribunal"). However, an application under section 39(5) of the Act was made for entertaining the appeal without payment. Installment of Rs. 2,000 per month was made which first the dealer could not deposit and later on when the full payment was made, an application was made for condoning the delay in making the payment. The said application was allowed with costs and the matter was heard on merits. The Tribunal vide order dated February 7, 2000 (annexure P20) dismissed the appeal. Thereafter, the dealer moved an application (annexure P21) for review of the order dated February 7, 2000 (annexure P20). The said application was also dismissed vide order dated July 17, 2000 (annexure P 22). Hence, the present writ petition. The averments made in the writ petition were controverted by respondent Nos. 1 to 3 by filing written statement.

(2.) The learned counsel for the petitioners submitted that the liability was sought to be fastened on the petitioners as according to the Department the petitioner through six vehicles had exported mustard oil from Sundrehti to Delhi via S.T.C.B. Badli (Rohtak) on different dates. According to the learned counsel, the petitioners had never entered into any of these transactions and an affidavit dated January 13, 1993 (annexure P4) to that effect was submitted with the assessing authority. Learned counsel while placing reliance upon the judgment of the honourable Supreme Court in Commissioner of Income-tax v. Daulat Ram Rawatmull, 1973 3 SCC 133contended that the onus was upon the Department to prima facie show that the assessee had some connection with these transactions. It was urged that the Revenue had not even made attempts to examine the owners of the vehicles in which the alleged goods according to the Revenue were exported. It was argued that the vehicle numbers were available with the revenue and in such a situation, some material could have been confronted to the assessee to establish that the assessee had transacted unaccounted sales. Additionally, it was pointed out that the petitioner was an exempted unit till November 3, 1988 without any limit of tax exemption and in such circumstances there was no occasion for the dealer to conceal any sales.

(3.) On the other hand, learned State counsel supported the orders passed by the authorities below.