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THE COMMISSIONER TRADE TAX LUCKNOW versus S/S SHARMA HANDLOOM INDUSTRIES

High Court of Judicature at Allahabad

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The Commissioner Trade Tax Lucknow v. S/S Sharma Handloom Industries - SALES/TRADE TAX REVISION No. 1935 of 2004 [2007] RD-AH 325 (5 January 2007)

 

This is an UNCERTIFIED copy for information/reference. For authentic copy please refer to certified copy only. In case of any mistake, please bring it to the notice of Joint Registrar(Copying).

HIGH COURT OF JUDICATURE OF ALLAHABAD

COURT NO.22

TRADE TAX REVISION NO.1935 OF 2004

The Commissioner, Trade Tax, U.P., Lucknow.       ....Applicant

Versus

S/s Sharma Handloom Industries, Agra.   .Opp.party

***************

Hon'ble Rajes Kumar, J.

Present revision under Section 11 of U.P. Trade Tax Act (hereinafter referred to as "Act") is directed against the order of Tribunal dated 04.02.2004 relating to the assessment year 1996-97 under U.P. Trade Tax Act.

Dealer/opposite party (hereinafter referred to as "Dealer") was mainly involved in the business of manufacture of handloom dari, which was exempted from tax under section 4 of the Act. Dealer had also manufactured handloom bags in small quantity. The entire handloom bags had been exported outside the country and the exemption on such sale was claimed. It was claimed that no sale of handloom bags was made within the State of U.P. Books of account have been rejected on the ground that the dealer had not maintained manufacturing account as required under section 12 (2) of the Act. Tribunal has accepted the books of account and disclosed turn over on the ground that the dealer was not required to maintain manufacturing account as required under section 12 (2) of the Act, in respect of the handloom dari as it was exempted from tax under section 4 of the Act.

Heard learned counsel for the parties.

Learned Standing Counsel submitted that since dealer was also involved in the manufacturing of handloom bags, dealer was required to maintain manufacturing account as required under section 12 (2) of the Act for the manufacturing of handloom bag and since it was not maintained books of account was liable to be rejected and the turn over was liable to be assessed by way of best judgment assessment. Learned Standing Counsel relied upon the order of the Tribunal.

Having heard learned counsel for the parties, I have perused the order of the Tribunal and the authorities below.

Under section 12 (2) of the Act manufacturing account is required to be maintained only in respect of the taxable goods and not in respect of the non-taxable goods. Thus, dealer was not required to maintain the manufacturing account for handloom dari. Reliance is placed on the decision of this Court in the case of M/s Ansar Traders Vs. Commissioner of Sales Tax, reported in 1987 UPTC, 1256. Admittedly, dealer had not maintained manufacturing account for the handloom bags as required under section 12 (2) of the Act. Apex Court in the case of Commissioner of Sales Tax, U.P., Lucknow Vs. M/s Girja Shanker Awanish Kumar, reported in 1997 UPTC, 213.  held that in the absence of non-maintenance of manufacturing account as required under section 12 (2) of the Act, books of account are liable to be rejected and the best judgment assessment is to be made. Therefore, in the absence of non-maintenance of manufacturing account in respect of the handloom bags acceptance of books of account is not justified. However, looking to the facts of the present case, namely that the entire handloom bags had been exported outside the country and had not been sold inside the State of U.P., there was no justification for the estimate of intra-State turn over of handloom bags in the absence of any material. Thus, order of the Tribunal accepting the disclosed turn over does not require any interference.

In the result, revision fails and is accordingly, dismissed.

Dt.05.01.2007

R./


Copyright

Reproduced in accordance with s52(q) of the Copyright Act 1957 (India) from judis.nic.in, indiacode.nic.in and other Indian High Court Websites

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