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M/S Bansal Casting Company v. The Commissioner, Of Trade Tax, - SALES/TRADE TAX REVISION No. 27 of 2000  RD-AH 15583 (7 September 2006)
TRADE TAX REVISION NO.27 of 2000
M/S Bansal Casting Company, Agra. Applicant
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 19th September, 1998 relating to the assessment year, 1987-88.
The applicant was engaged in the business of manufacture and sale of C.I. Casting, Kolhu and its part etc. It was claimed that the books of account have been maintained in the regular course of business including production register consisting of stock register of raw material and finished goods. It was submitted that certain machinery parts etc have been got manufactured on job work basis from the U.P. purchased items. It was purchased for Rs. 1,66,034.14 paise on which labour charges were paid at Rs.26, 645/-, total comes to Rs. 1, 92, 679.14 paise. Assessing authority rejected the books of account on the ground that the manufacturing account has not been maintained in accordance to section 12 (2) of the Act. It has also been observed that day to day details of the goods given for manufacturing on job work basis has also not been furnished. The Assessing Authority as against the taxable turnover of Rs. 23, 26, 888.86 paise, estimated at Rs. 29, 46, 400/-. First appeal was allowed and books of account and disclosed turnover were accepted. Commissioner of Trade Tax filed appeal before the Tribunal. Tribunal by the impugned order, allowed the appeal, set aside the order of the first appellate authority, so far as it accepted the books of account and disclosed turnover and the restored the order of the assessing authority. Tribunal has confirmed the rejection of the books of account on the ground that the applicant has not maintained manufacturing account at every stage of production under section 12 (2) of the Act and also not given day to day detail of the goods issued for the manufacturing on job work basis. Tribunal held that the maintenance of manufacturing account under section 12 (2) of the Act has been held mandatory by the Apex Court in the case of Commissioner of Sales Tax Versus M/S Girja Shaker Awanish Kumar reported in 1997 STI, 34
Heard learned counsel for the parties.
Learned counsel for the applicant submitted that the Tribunal is wrong to say that the manufacturing accounts have not been maintained in accordance to Section 12 (2) of the Act. He submitted that there is only one stage of production namely, melting of pig iron and manufacturing of cast iron casting, kolhu and kolhu parts. He submitted that for the manufacturing of cast iron casting , kolhu and kolhu parts, day to day stock register of pig iron and day to day stock register of finished goods have been maintained. He further submitted that the goods for Rs.1,66,034.14 paise were purchased within the State of U.P. which were given for manufacturing on job work basis on which a sum of Rs. 26, 645/- was paid towards labour charges. Necessary details of the purchases and the payment of labour charges have been furnished. He submitted that the entries of purchases and labour charges are duly available on record. He submitted that even if day to day details of the issue of the items have not been furnished and it may be a discrepancy on the part of the applicant, but for the minor discrepancy relating to the turnover of Rs. 1, 92, 679.14 paise, the enhancement of the turnover to this extent is not justified. Learned Standing Counsel relied upon the order of the Tribunal.
Having heard the learned counsel for the parties, I have perused the order of the Tribunal and the authorities below.
Tribunal has observed that the manufacturing account at every stage of productions have not been maintained in accordance to Section 12 (2) of the Act, but it has not been disclosed that what are the stages of production. According to the applicant there is only one stage of production, namely, melting of pig iron and manufacturing of cast iron casting, kolhu and kolhu parts for which day to day stock register of pig iron and day to day stock register of finished goods have been maintained, which complies the requirement of Section 12 (2) of the Act. Thus, this aspect of the matter requires reconsideration and verification. If there is only one stage of production as has been submitted by the learned counsel for the applicant and the applicant has maintained stock register of raw material and finished goods, it complies the requirement of Section 12 (2) of the Act. However, in respect of the items got manufactured on job work basis according to the applicant necessary details of the purchases and the labour charges have been furnished, which is Annexure 1 to the revision petition and if, day to day detail of the issue of raw material to the manufacturer through whom the product has been got manufactured has not been given, it may be a ground for the rejection of the books of account, but Tribunal should examine whether such discrepancy leads to the suppression of the turnover and how much turnover is to be enhanced.
For the reasons stated above, the order of the Tribunal is set aside and the matter is remanded back to the Tribunal to decide the appeal afresh.
In the result, revision is allowed. The order of the Tribunal is set aside and the matter is remanded back to the Tribunal to decide the appeal afresh in the light of the observations made above.
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