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M/S SHUKLA STEEL TRADERS LORAULI KONDRA versus THE COMMISSIONER TRADE TAX U.P. LUCKNOW

High Court of Judicature at Allahabad

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M/S Shukla Steel Traders Lorauli Kondra v. The Commissioner Trade Tax U.P. Lucknow - SALES/TRADE TAX REVISION No. 1175 of 2006 [2006] RD-AH 16493 (20 September 2006)

 

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.1175 OF 2006

AND

TRADE TAX REVISION NO.1176 OF 2006

M/s Shukla Steel Traders, Basti.       ....Applicant

Versus

The Commissioner, Trade Tax U.P., Lucknow.        .....Opp.party

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

Hon'ble Rajes Kumar, J.

These two revisions under Section 11 of U.P. Trade Tax Act (hereinafter referred to as "Act") are directed against the order of Tribunal dated 19th May, 2006 relating to the assessment years 1990-91 and 91-92.

Applicant was carrying on the business of iron scrap and hardware. For the assessment years 1990-91 and 91-92 assessments proceedings were completed under the summary scheme without making any enquiry. Deputy Commissioner (Executive) on the examination of the assessment file was prima facie of the view that the assessment orders were illegal and improper, c onsequently, show cause notice was issued under section 10-B of the Act. The show cause notice was given on the various grounds. After the show cause notice, statement on oath was also recorded. However, applicant did not produce the books of account for verification before the Deputy Commissioner (Executive) on the pretext that the books of account were burnt in an accidental fire during the Deepawali festival.  Deputy Commissioner (Executive) after considering the statement of the applicant reached to the conclusion that the applicant was trying to justify the purchases made in the month of March, 1991 against Form-31 with its sale in the month of July, 1990 against Form 3-B, which is not believable. It has categorically recorded the specific finding that the applicant has not disclosed the sales in respect of the purchases made in the month of March and April, 1991 and these sales have been suppressed and have not been disclosed in the books of account. On these premises, for the assessment year 1990-91  it estimated the suppressed sale of iron scrap at Rs.25 lacs and levied the tax of Rs.1 lac. Similarly for the assessment year 1991-92 it was found that the applicant had imported 10 MT of iron scrap for Rs.64,844/- against Form-31 No.FX 533644 against bil no.1028 dated 10.04.1991 but the same had not been disclosed as the imported purchases and had not shown its sale. The sale of copper scrap was taxed @  2.5% while it should be taxed as an unclassified item and in the month of May, June and July turn over at Rs.17,730/-, Rs.57,538.50p. and Rs.70,074/- of iron scrap was disclosed while the purchases of iron scrap upto July was shown only at Rs.38,370/-. In the month of April in the provisional assessment order, turn over of self manufactured hardware was estimated at Rs.20,000/- while in the final assessment order, turn over of Rs.5231/- had been accepted. Deputy Commissioner (Executive) accordingly, estimated the turn over of hardware at Rs.2 lacs, imported scrap at Rs.5 lacs and taxable scrap at Rs.94,000/-. Against the order passed under section 10-B of the Act for the aforesaid assessment years, applicant filed two appeals before the Tribunal. Tribunal vide order dated 29.08.1996  allowed both the appeals and set aside the order passed under section 10-B of the Act. Against the order of the Tribunal for the assessment year 1990-91, Trade Tax Revision No.1309 of 1996, CTT Vs, M/s Shukla Steel Traders was filed and for the assessment year 1991-92, Trade Tax Revision No.1301 of 1996, CTT Vs. M/s Shukla Steel Traders, Basti was filed. Both the revisions have been allowed by this Court. Trade Tax Revision No.1309 of 1996 for the assessment year 1990-91 was allowed vide order dated 04.07.2005. This Court on the facts and circumstances of the case, held that initiation of proceedings under section 10-B of the Act was justified. Since the Tribunal has not decided the matter on merit, therefore, the matter was remanded back to the Tribunal to consider the merit of the case. It was made clear that it would be not open to the applicant to challenge the jurisdiction of the Commissioner (Executive) to exercise its power under section 10-B of the Act.  Trade Tax Revision No.1301 of 1996  for the assessment year 1991-92 was allowed vide order dated 15.12.2004. The initiation of the proceeding under section 10-B of the Act has been held justified and the Tribunal was directed to decide the appeals on merit. By the impugned order, Tribunal has allowed the appeal and remanded back the case to the Deputy Commissioner (Executive). Tribunal has examined the matter on merit and, thereafter, has come to the conclusion that the Deputy Commissioner (Executive) has not examined the matter properly and, therefore, remanded back the matter to the Deputy Commissioner (Executive).

Heard learned counsel for the parties.

Learned counsel for the applicant submitted that the remand of the case to the Deputy Commissioner (Executive) is not justified. He submitted that the Tribunal ought to have decided the appeals on merit itself. Learned Standing Counsel submitted that this Court has directed the Tribunal to consider the merit of the case because earlier Tribunal has decided the appeal merely on the ground that in such a situation the proceeding under section 10-B of the Act could not taken. He submitted that this Court has not restricted the power of Tribunal to remand back the case to the Deputy Commissioner (Executive) on consideration of merit.

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

Admittedly, the assessment orders for the assessment years 1990-91 and 91-92 have been passed under the summary proceedings without making any enquiry. On the basis of material on record, this Court held that the initiation of proceedings under section 10-B of the Act was justified. Since in the orders passed under section 10-B of the Act by Deputy Commissioner (Executive), the merit of the case has not been considered. This Court has directed the Tribunal to examine the merit of the case.  Tribunal on the facts and circumstances of the case has come to the conclusion that the case has not been properly examined by Deputy Commissioner (Executive) before estimating the turn over and, therefore, remanded back the case to the Deputy Commissioner (Executive) for fresh orders. After going through the order of the Tribunal and the order of the Deputy Commissioner (Executive), I am of the view that since the assessment orders were passed under the summary scheme without making enquiry, it would be appropriate that the matter may be sent back to the assessing authority for passing assessment orders afresh after making necessary enquiry on the material referred in the order passed under section 10-B of the Act and the material referred in the order passed by the Tribunal and the directions given by the Tribunal in this regard.

In the result, both the revisions are allowed in part.  The order of the Tribunal is modified to the extent that the cases are being remanded back to the assessing authority for passing assessment orders afresh after making necessary enquiry and giving proper opportunity of hearing to the applicant.

Dt.20.09.2006

R./


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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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