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Issues: Whether the notice for provisional assessment under section 41B of the Gujarat Sales Tax Act, 1969 could be initiated on the basis of the alleged treatment of freight charges as part of the sale price and taxable turnover.
Analysis: Section 41B permits provisional assessment where the Commissioner has reason to believe that the dealer has evaded tax, and that opinion is a prerequisite for action. The Court found that the impugned notices did record such belief. Whether the freight entries in separate debit notes were genuine reimbursement charges or were in substance part of the sale price depended on disputed facts, including the true nature of the pricing arrangement and the underlying records. The Court held that the transport charges could not be accepted as outside the sale price merely on the basis of a few invoices or debit notes, and that the matter could not be decided in writ jurisdiction without examination of the full record.
Conclusion: The challenge to the initiation of provisional assessment failed and the action under section 41B was upheld.
Ratio Decidendi: Where the statute authorises provisional assessment on the Commissioner's reasoned belief of tax evasion, and the true character of freight recovered through separate debit notes raises disputed questions of fact, writ jurisdiction will not be used to restrain the assessment proceedings.
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