Burden of proof on form 15 declarations cannot be diluted by pro rata treatment of contravention

The statutory scheme placed the burden on the assessee to prove that purchases made against form 15 declarations were not includible in taxable turnover, so contravention of the form's recitals could not be assessed on a prudent-man or pro rata basis. A presumption that goods purchased on form 15 were used only for permissible sales would defeat that burden and render the requirement under section 14(3) ineffective. The earlier binding authority required rejection of the Tribunal's approach, and the Tribunal's view was therefore erroneous.

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Issues: Whether, on the facts and in the circumstances of the case, the extent of contravention of the recitals in form 15 was to be determined on the basis of prudent man's theory or on a pro rata basis.

Analysis: The relevant statutory scheme placed the burden on the assessee to prove that purchases made against declarations under the Act were not liable to be included in taxable turnover. A presumption that the goods purchased on form 15 had been used only for permissible sales would neutralise that burden and would make the statutory requirement under section 14(3) ineffective. The earlier binding authority required rejection of the approach adopted by the Tribunal.

Conclusion: The question was answered in the negative and the Tribunal's view was held to be erroneous.

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