Limitation, best judgment assessment, and inter-State tax rate correction in sales tax revision proceedings.

For limitation under the U.P. Sales Tax Act, time ran from delivery of the revisional order to the assessee, not from mere preparation of a certified copy, and the revisions were held within time. Where the assessee failed to produce account books before the sales tax authorities, rejection of the books and resort to best judgment assessment was justified, so the turnover determination was upheld. On the inter-State turnover of Rs. 22,000, the tax rate applied was found excessive for the relevant period, and the correct rate was 3%, with only that part of the assessment being adjusted.

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Issues: (i) Whether the revisions were barred by limitation under section 11 of the U.P. Sales Tax Act. (ii) Whether rejection of the assessee's account books and adoption of best judgment assessment were justified. (iii) Whether the tax on the turnover of Rs. 22,000 relating to inter-State sale was liable to be charged at 3% instead of 10%.

Issue (i): Whether the revisions were barred by limitation under section 11 of the U.P. Sales Tax Act.

Analysis: The period of limitation was held to run from the date on which the impugned revisional order was delivered to the assessee, and not from the date on which a certified copy was merely prepared. The presumption of delivery by registered post was found to have been rebutted on the facts, and the copy admittedly received later brought the revisions within time.

Conclusion: The revisions were not barred by limitation.

Issue (ii): Whether rejection of the assessee's account books and adoption of best judgment assessment were justified.

Analysis: The assessee did not produce its account books before the sales tax authorities. In such circumstances, the assessing authority was justified in resorting to best judgment assessment, and no ground was made out for interference with the turnover determined by the authorities.

Conclusion: The best judgment assessment was upheld.

Issue (iii): Whether the tax on the turnover of Rs. 22,000 relating to inter-State sale was liable to be charged at 3% instead of 10%.

Analysis: The rate applied by the assessing authority was found to be excessive for the relevant period, and the respondent accepted that the correct rate was 3%.

Conclusion: The tax on the inter-State sale turnover of Rs. 22,000 was directed to be computed at 3%.

Final Conclusion: The revisions succeeded only to the limited extent of reduction of tax rate on the inter-State turnover, while the assessment and turnover determination otherwise stood confirmed.

Ratio Decidendi: For limitation under section 11 of the U.P. Sales Tax Act, time runs from delivery of the impugned order to the assessee, and where account books are not produced, best judgment assessment is justified; any erroneous tax rate applied to a determined turnover may be corrected without disturbing the rest of the assessment.

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