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M/S JAYPOEE CEMENT LTD. THRU' SR. GENERAL MANAGER (FIN.) versus THE COMMISSIONER OF TRADE TAX, U.P. LUCKNOW

High Court of Judicature at Allahabad

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M/S Jaypoee Cement Ltd. Thru' Sr. General Manager (Fin.) v. The Commissioner Of Trade Tax, U.P. Lucknow - SALES/TRADE TAX REVISION No. 1599 of 2006 [2007] RD-AH 562 (10 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

AFRRESERVED

TRADE TAX REVISION NO. 1599 OF 2006

M/s Jaypee Cement Ltd. Iradatganj,

Ghoorpur, Allahabad.             ....Applicant

Versus

The Commissioner of Trade Tax, U.P. Lucknow.      ...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 18.08.2006 relating to the assessment year 2002-03 under Central Sales Tax Act (hereinafter referred to as "Central Act").

Applicant is engaged in the business of manufacture and sales of cement. The factory is situated at Rewa (Madhya Pradesh) and one of the sales depot is situated at Bareilly in U.P. and in the State of Uttaranchal,  applicant has depot at Kichcha. There was one sale promoter of the applicant company at Kichcha namely, M/s Shyamji Cement Distributor, Kichcha having its Head Officer at Bareilly.  Applicant used to send the cement by way of stock transfer from its Rewa factory to Bareilly depot and also directly to Kichcha depot. It was claimed that the goods were also dispatched from Bareilly depot to Kichcha by way of stock transfer and, thereafter, same were sold to the various parties of Uttaranchal. On 03.01.2004 survey was made at the premises of M/s Shyamji Cement Distributor, Bareilly in which certain documents were seized, which were mainly related to the assessment year 2003-04. However, ex. No.2 and 3 and loading advice no.315 and 317 dated 23.03.2003 related to the assessment year 2002-03. Number of builties were also found relating to the assessment year 2003-04. From these builties it was detected that for same goods one builty was prepared from Bareilly to Kichcha and another from Kichcha to the destination of parties. Both the builties were prepared at Bareilly. In this view of the matter, it was inferred that there were pre-existing orders of the parties and the goods were directly dispatched from Bareilly to the customers in the course of inter-State sales and just to show the dispatches, as stock transfer two builties were prepared, one for Bareilly to Kichcha and another for Kichcha to the destination of the parties. While making the assessment for the assessment year 2002-03 under Central Sales Tax Act, assessing authority asked the applicant to produce the loading invoices, which were not produced before the S.T.O. (S.I.B.) for the verification but the same were not produced before the assessing authority. It was found that during the year under consideration, 5497.80 MT cement were shown to have been dispatched to Kichcha depot by way of stock transfers. In the absence of proper verification of the stock transfers due to non-production of the loading invoices, assessing authority rejected the claim of stock transfers and treated as inter-State sales.  Assessing authority in its order had also mentioned that before S.T.O. (S.I.B.), Bareilly, applicant had not produced the dispatch advices, challans, builties and loading invoices and the stock register of Bareilly godown for the assessment year 2002-03 for verification. The report of buffer stock was also demanded but the same was also not produced. Loading invoices prior to loading invoice no.315 were also demanded but the same were not produced. Applicant being aggrieved by the order of the assessing authority, filed appeal before Joint Commissioner (Appeals), Trade Tax, Allahabad. Joint Commissioner (Appeals) vide order dated 13.05.2006 allowed the appeal and accepted the impugned dispatches as stock transfers and deleted the tax on the amount of Rs.23,97,974/-. Being aggrieved by the order of Joint Commissioner (Appeals), Commissioner of Trade Tax filed appeal before the Tribunal. Tribunal by the impugned order allowed the appeal and set aside the order of the first appellate authority and remanded back the matter to the assessing authority for passing assessment order afresh. Tribunal held that perusal of the documents seized at the time of survey dated 03.01.2004 which mainly related to the assessment year 2003-04 reveals that cement were supplied directly to the parties from Bareilly depot instead to the Kichcha depot. Therefore, assessing authority had every reason to doubt the claimed stock transfers from Bareilly depot to Kichcha depot for the assessment year 2002-03. Tribunal held that under section 6-A of Central Act burden lies upon the assessee to prove the claim of stock transfers and for which Form-F and builties were produced. But on the basis of the documents which were found at the time of survey dated 03.01.2004 stock transfers had been doubted and the assessing authority had a right to verify the correctness of the stock transfers and merely on the basis of the Form-F and builties the claim of stock transfers can not be accepted. Tribunal held that the stock register of Kichcha depot was produced but the loading advices and their details from Kichcha depot have not been produced. While the loading invoice nos.315 and 317 were found at the time of survey-dated 03.01.2004. Tribunal held that in order to prove the stock transfers and the receipt of the cement at Kichcha depot it was necessary for the applicant to produce the loading invoices and the stock register and the further dispatches of the goods from Kichcha depot but the record shows that stock register and loading invoices of Kichcha depot have not been produced. Tribunal further held that the assessing authority had also failed to summon the stock register of Kichcha depot and all loading invoices, which are necessary to judge the correctness of the stock transfers under Rule 75 of U.P. Trade Tax Rules, 1948 (hereinafter referred to as "Rules"). In this view of the matter to provide the opportunity to the applicant to produce stock register, dispatch advices and for fresh examination of matter case has been remanded back to the assessing authority.

Heard Sri Bharatji Agrawal, learned Senior Advocate appearing on behalf of the applicant and Sri B.K. Pandey, learned Standing Counsel.

Learned counsel for the applicant submitted that in support of the claim of stock transfer from Bareilly depot to Kichcha, applicant had furnished Form-F as required under section 6-A of Central Act and Rules framed thereunder. He submitted that there is no evidence on record to show that the goods had moved from Bareilly to Uttaranchal in pursuance of any contract of sale and thus, the rejection of claim of stock transfer was not justified. He submitted that there is no justification for remanding back the matter to the assessing authority. He submitted that the applicant is ready to produce the loading invoices and the stock register of the Kichcha depot for verification even before the Tribunal. Tribunal being the last Court of fact can also examine these documents at its own stage.  In support of his contention he relied upon the decision in the case of M/s Kamal Corporation, Bindki, district Fatehpur Vs. Commissioner of Trade Tax, U.P., Lucknow, reported in 2006 NTN (Vol.31), 226, Nehru Steel Rolling Mills, Muzaffarnagar  Vs. Commissioner of Sales Tax, reported in 1993 NTN (Vol.2), 31.

Learned Standing Counsel submitted that each case is to be considered on the facts of its own case. He submitted that in the present case from the seized documents, it was found that for the assessment year 2003-04 two builties were prepared from the Bareilly depot itself, one for the Kichcha depot and another for Kichcha depot to the parties concerned, which clearly establishes that there were  pre-existing orders of the parties of Uttaranchal and the goods had moved from Bareilly depot to Uttaranchal in pursuance of the orders and, therefore, assessing authority had every valid reason to doubt the stock transfers for the assessment year 2002-03 also and to make a deep enquiry in this regard. He submitted that in the process of enquiry assessing authority had asked to produce the stock register of Kichcha depot and loading invoices to verify the receipt of the cement at Kichcha depot and the movement of goods from Kichcha depot. Since two loading invoice nos.315 and 317 were found at the time of survey, the applicant can not say that loading invoices have not been maintained and it was bound to produce all the loading invoices. He submitted that the assessing authority had also observed that the challans, builties and loading invoices and Bareilly godown register have not been produced. He further submitted that these are the necessary documents for judging the correctness of the stock transfers. Thus, Tribunal has rightly remanded back the matter to the assessing authority with the direction to summon those documents in exercise of powers under Rule 75 of Rules, and to enquire the matter after giving proper opportunity of hearing to the applicant.

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

In the present case, at the time of survey dated 03.01.2004 made by S.T.O. (S.I.B.) certain builties were found which reveals that for the same goods two builties have been prepared; one for Bareilly godown to Kichcha depot and another for Kichcha godown to the destination of the parties and both the builties have been prepared at the Bareilly godown. On the basis of which an inference was drawn that the movement of goods from Bareilly depot to Uttaranchal were in pursuance of pre-existing orders of the Uttaranchal parties. Though these seized builties were relating to the assessment year 2003-04 but it raised a reasonable doubt to the stock transfers for the assessment year 2002-03 also and, therefore, in the process of enquiry to judge the correctness of the stock transfers if assessing authority required the applicant to produce the stock register of Kichcha depot and all loading invoices and other documents, in support of the claim of stock transfers, they should have been produced. Needless to say that under section 6-A of Central Act, burden lies upon the assessee to prove the claim of stock transfers. In case if the desired documents have not been produced by the applicant, assessing authority should have summon those documents in exercise of powers under Rule 75 of the Rules.

Thus, I do not find any error in the view of the Tribunal that, to judge the correctness of the claim of stock transfers, the stock register of Kichcha depot and loading invoice are to be examined.

Learned counsel for the applicant submitted that the applicant is ready to produce the stock register of Kichcha depot and the loading invoices before the Tribunal itself and the Tribunal may examine those documents at its own stage instead of remanding back the matter to the assessing authority, being the last Court of fact.

I do not find any substance in the argument of learned counsel for the applicant. If the Tribunal desired the examination of those documents by the assessing authority, it can not be said to be illegal. The examination of those documents and further enquiry in the matter is more appropriately possible at the stage of the assessing authority. In the circumstances, I do not see any reason to interfere with the order of the Tribunal. The decisions cited by the learned counsel for the applicant are not applicable to the present case and are clearly distinguishable. There are the cases where case was remanded for providing fresh inning to the assessing authority. Present in not the case of remand for providing fresh inning to the assessing authority to adjudicate the matter afresh. As stated above, in the present case applicant could not produce the relevant documents, which were asked by the assessing authority to produce, which has been held relevant to adjudicate the correctness of the transactions.

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

Dt.10.01.2007

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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