Burden of proof under resale certificate proviso lies on the department when seeking to fasten sales tax liability.

Under rule 5(1)(vi) of the Bombay Sales Tax Rules, 1952, read with section 34(1) of the Bombay Sales Tax Act, 1953, the deduction for goods certified as purchased for resale could be denied under the proviso only if the department proved, by positive evidence, that the certificates had actually been issued and that the goods were used otherwise than for resale. The negative fact that no certificate was given did not have to be proved by the assessee. The burden therefore lay on the department, and the issue was answered in favour of the assessee.

---

---

Issues: Whether, where the purchasing dealer was alleged to have given certificates under rule 5(1)(vi) of the Bombay Sales Tax Rules, 1952, the burden lay on the department to prove issuance of the certificates and consequent liability under the proviso.

Analysis: The reference arose on a question concerning the incidence of proof under rule 5(1)(vi) of the Bombay Sales Tax Rules, 1952, read with section 34(1) of the Bombay Sales Tax Act, 1953. The rule allowed deduction where the purchasing dealer certified that the goods were required for resale, and its proviso operated only if the goods were used otherwise than for resale. The Court accepted the view that, once the department sought to fasten liability under the proviso, it had to establish by positive evidence that the certificates had in fact been issued and that the proviso was attracted. The negative fact that no such certificate had been given was not required to be proved by the assessee.

Conclusion: The burden of proving issuance of the certificates lay on the department, and the question was answered in the affirmative in favour of the assessee.

---