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M/S. Kishan Brick Works v. The Commissioner Of Trade Tax, U.P. Lucknow - SALES/TRADE TAX REVISION No. 410 of 1999 [2007] RD-AH 8279 (2 May 2007)


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Court No.22.

Trade Tax Revision No. 410 of 1999.

M/S Kishan Brick Works, Kaithi, Karchana, Allahabad


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


Hon'ble Vikram Nath, J.

Heard Sri Krishna Agrawal, learned counsel for the applicant and Sri B.K. Pandey, learned standing Counsel for the Department/opposite party.

The dispute relates to the assessment year 1986-87 U.P.  The following questions of law have been raised in this revision-

(i) Whether on the facts and circumstances of the case, the Tribunal is legally justified in confirming the rejection of books of accounts without stating the reasons merely on the ground that the books of accounts could not be produced at the time of survey which is factually incorrect ?

(ii) Whether the books of accounts have been produced at the time of survey ?

(iii) Whether the rejection of firing period is based on any material and the enhancement of firing period by 21 days in the first season and 18 days in second season are based on relevant material and are legally justified ?

(iv) Whether the estimate of average selling rate at Rs. 365.00 is based on any material, inasmuch as the actual selling rate mentioned in survey report and there is no contrary material on record ?

The applicant (hereinafter referred to as the dealer) is involved in manufacturing and sale of bricks.  Five surveys were made at the brick-kiln on 13.4.1986, 25.5.1986, 7.1.1987, 4.2.1987 and 13.3.1987.  In the initial four surveys some account books were found, however, in the last survey no account books were produced at the time of survey.  Show cause notice was issued by the Assessing Officer to which the dealer submitted its reply.  Thereafter Assessment order was passed on 16.3.1991 whereby the account books submitted by the dealer during the assessment proceedings were not accepted and Assessing Officer thereafter based upon other material and relevant facts held firstly that the total quantity of the bricks sold was 21,50,000 at the rate of Rs.380/- per thousand, thus reaching the turn over of Rs.8,17,000/-.  Accordingly tax was imposed.  The dealer preferred appeal before the Assistant Commissioner (Judicial).  Appeal was partly allowed by the Assistant Commissioner (Judicial) vide order dated 31.8.1991 in which the rate of sale was reduced from Rs.380/- to Rs.370/- per thousand and the saleable bricks held to be 14,38,850.  Accordingly the tax liability was reduced. The dealer filed Second  Appeal and the Trade Tax Tribunal vide order dated 14.6.1999 further reduced the rate of sale at Rs. 365/- per thousand and fixed the quantity of saleable bricks as 13,24,850. Second Appeal was filed by the Department also which was partly allowed to the extent that the purchase value of the sand and coal was increased and the tax liability on the same was accordingly enhanced. Aggrieved by the same present revision has been filed.  

The first two questions are interlinked and are therefore taken together.

The submission of the learned counsel for the dealer with regard to the said questions is that account-books have been rejected only on the ground that they were not produced during the survey, whereas the fact is that the account books were produced at the time of survey as is evident from four survey reports which do mention that in some of the survey certain records like Account- books, Stock Register, another Register and challan was also found in which entry of the purchase of coal was mentioned.

The other submission of the learned  counsel for the dealer with regard to the above question is that merely because the account-books were not found at the time of survey, even though they were produced during assessment proceedings, cannot be a ground for rejection of the same. On the other hand Sri B.K. Pandey, learned Standing Counsel has submitted that in the last survey dated 13.3.1987 no account-books were produced. Further in the initial four surveys also complete account-books as required under law were not produced before the officers making the survey and only some of the account-books were produced.  According to him, all the authorities have dealt with this issue in detail and have ultimately come to the conclusion that the account-books were not worth acceptance.  

It has further been submitted by Sri Krishna Agrawal that after the survey dated 13.3.1987 in which the quantity of coal found at the time of survey was recorded as 5-6 tons only was not correct and in fact there was 25-26 tons of coal available.  At the site the Assessing Officer had not made complete inspection.  In this regard soon after the inspection an application was moved on 18.3.1987 addressed to the Assessing Officer that on the southern side of the brick-kiln about 20-25 tons of coal was still lying unused and therefore the survey memo may be corrected.  He further submits that in case this correction had been made, the production of bricks based upon the consumption of coal would tally with account-books maintained by the dealer.

The letter dated 18.3.1987 has not been dealt with by the Assessing Officer in the assessment order. In the order passed by the First Appellate Authority, i.e., Assistant Commissioner (Judicial) this point had not been pressed as is apparent from the contentions raised on behalf of the dealer noted in the said order.  Further even from perusal of the order passed by the Tribunal this aspect has not been pressed on behalf of the dealer at the time of hearing of the Second Appeal.  In absence of said point having not been argued and pressed before the authorities below, it cannot be permitted to be raised in this revision.

In view of the above discussion that the quantity of the coal determined to have been consumed by the dealer cannot now be  disputed, the turn-over taken by the authorities below based upon the production capacity of the brick-kiln cannot be faulted. Thus, the account-books not tallying with the quantity of the bricks manufactured based upon consumption of the coal if rejected even on the ground of non production of records at the time of survey also cannot be faulted.  The account books were liable to be rejected in any case.  

The third question raised is with regard to the enhancement of the firing period.  This finding on enhancement is also based upon consumption of the coal and, therefore, this finding also cannot be disputed.

With regard to the fourth question regarding the rate at which the bricks had been sold, the Assessing Officer had recorded that in the relevant year some of the sale transaction had been made at the rate of Rs.380/- per thousand. With regard to the contention that the quality of the bricks had been inferior it held that no evidence had been led and therefore, could not be accepted.  The first Appellate Authority reduced the rate to Rs.370/- per thousand whereas the Tribunal further reduced the rate to Rs.365/- per thousand relying upon the rate of the sale of the bricks by another manufacturer S/Sri Shambhu Eant Uddyog determined by the Tribunal in Appeal No. 210 of 1992 for the same assessment year.  

The submission of the learned counsel for the dealer is that rate for sale of the bricks had been fixed without any basis, cannot be sustained as the Tribunal has supported its rate on the basis of another decision of the Tribunal. No material has been placed before this Court to show advantage/disadvantage with regard to the location of S/Sri Shambhu Eant Uddyog as compared to the dealer to establish difference in the rate applied.

In view of the above discussion no question of law can be said to have arisen in this revision and all the findings recorded are based on material evidence and are findings of facts.

Revision lacks merit. It is, accordingly, dismissed.

Dated: 2-5-2007



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