2010 (6) TMI 715 - HC - VAT and Sales Tax

Court upholds Tribunal decision on tax exemptions for groundnut dealer, emphasizing factual evidence over presumptions. -basedRuling

MS. Mani Versus State of Tamil Nadu and others

The High Court upheld the second respondent-Tribunal's decision to set aside the Sales Tax Appellate Tribunal's order granting tax exemptions to a ... Whether the so-called purchases and the bills relied upon by the petitioner were bogus one and therefore, the claim of the second sales cannot be accepted? Held that:- As far as the dealer S. Abdul Khader of Saleem Traders was concerned, the second respondent-Tribunal has noted that there was a direct evidence, viz., the owner of the premises, where the dealer was said to have carrying on his business. The said person had deposed before the assessing authority that the concerned dealer, viz., S. Abdul Khader was not doing any business on and after January 1, 1983 in his premises. When such an unassailable evidence, which was not contradicted before the assessing authority, was available with the assessing officer, which was relied upon to hold that the bills said to have been issued by him bearing the said address in the years 1983-84, cannot be accepted as valid bills, we have no reason to take a different view than what has been taken by the second respondentTribunal. Appeal dismissed. Issues:Challenge to Tribunal's order on tax exemptions for groundnut purchases in assessment years 1983-84 and 1984-85.Analysis:The petitioner, a groundnut dealer, claimed exemption on purchases made from registered dealers based on permits issued by the Marketing Committee of Dindigul. The assessing officer initially accepted the claim but later reopened the assessment, levying tax and penalty. Appeals were dismissed by the Appellate Assistant Commissioner, but the Sales Tax Appellate Tribunal (STAT) allowed the appeals. The State filed tax case revisions before the second respondent-Tribunal, which held the purchases and bills were bogus, setting aside the STAT's order.The petitioner contended that valid bills and permits should have been sufficient evidence, citing a previous court decision. The High Court examined the orders of lower authorities and found the second respondent-Tribunal's decision justified. The STAT presumed purchases from registered dealers as bona fide unless proven otherwise. However, the second respondent-Tribunal found evidence that the selling dealers were non-existent during the relevant assessment years, leading to tax and penalty levies.The High Court analyzed the evidence presented by both the STAT and the second respondent-Tribunal. It noted that direct evidence from the premises owners indicated the selling dealers were not conducting business during the assessment years. The High Court upheld the second respondent-Tribunal's decision based on the material evidence available, concluding that the bills were indeed bogus. The court rejected the STAT's conclusions, emphasizing the importance of factual evidence over presumptions.Regarding a previous court decision cited by the petitioner, the High Court found the facts in that case significantly different from the present case, making it inapplicable. The court dismissed the writ petitions, upholding the second respondent-Tribunal's order. The petitioner's reliance on the previous court decision was deemed irrelevant, and the petitions were dismissed without costs.