Earlier survey evidence alone cannot sustain a sales tax assessment without proof of business activity in the relevant year.

A dealer cannot be assessed for a later assessment year solely on the basis of a survey conducted in the preceding year unless there is material showing business activity in the relevant year. Material from an earlier year, by itself, is insufficient proof of turnover for the year under assessment. On the facts noted, no evidence showed that the dealer carried on business during the assessment year 1978-79, so the assessment based only on the prior survey could not be sustained. The revision was allowed and the matter was remanded under Section 11(8) of the U.P. Sales Tax Act.

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Issues: Whether the dealer could be assessed for the assessment year 1978-79 solely on the basis of a survey made in the preceding assessment year and without material showing business activity in the year in question.

Analysis: The only basis for rejecting the dealer's claim of nil turnover was the survey dated 23rd April, 1977, which related to the earlier assessment year. Material found in a preceding year could not, by itself, be treated as proof of business activity in the year under assessment. In the absence of any material showing that the dealer carried on business during the relevant year, the authorities below erred in sustaining the assessment merely on the strength of the earlier survey.

Conclusion: The assessment could not be sustained on the basis of the preceding year's survey alone, and the revision was allowed with the matter remanded under Section 11(8) of the U.P. Sales Tax Act.

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