Foundational findings required for presumptive tax levy; missing statutory form alone cannot sustain assessment.

Liability under section 3-D(2) of the U.P. Sales Tax Act arises only when the notified goods are sold to a purchaser other than a registered dealer and the other statutory conditions are met. Mere non-furnishing of form III-C(5) under rule 12-B(7) may justify assessment proceedings, but it does not replace the need for foundational findings that the sales were to unregistered dealers and that the statutory presumption under section 3-D(7)(b) was not rebutted. An assessment order based only on absence of the prescribed form, without recording those essential jurisdictional facts, reflects non-application of mind and cannot sustain the levy on the disputed turnover.

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Issues: Whether the assessment under section 3-D(2) of the U.P. Sales Tax Act, 1948 could be sustained when the assessment order contained no finding that the disputed sales were made to unregistered dealers and no finding that the statutory presumption under section 3-D(7)(b) had not been rebutted.

Analysis: Liability under section 3-D(2) arises only if the notified goods are sold to a purchaser who is other than a registered dealer and the other statutory conditions for invoking that provision are satisfied. The mere omission to furnish form III-C(5) under rule 12-B(7) of the U.P. Sales Tax Rules, 1948 may expose the dealer to assessment, but it does not by itself dispense with the necessity of recording the foundational findings required by section 3-D. The assessment order proceeded only on the absence of the prescribed form and did not record any conclusion that the sales were to unregistered dealers or that the rebuttable statutory presumption had not been displaced. The record therefore showed non-application of mind to an essential jurisdictional ingredient of the levy.

Conclusion: The assessment under section 3-D(2) could not be sustained and was liable to be quashed to the extent it taxed the disputed turnover.

Final Conclusion: The writ petition succeeded because the impugned assessment was vitiated for want of the necessary statutory findings before fastening tax liability on the disputed sales.

Ratio Decidendi: A tax assessment invoking a deeming or presumptive charging provision cannot stand unless the authority records the foundational statutory facts required to attract the levy and addresses the rebuttal of any statutory presumption; failure to file a prescribed form, by itself, is insufficient to sustain the assessment.

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