Rebuttable transit-pass presumption failed where evidence showed interstate movement and no intra-State sale was established.

Section 18B creates a rebuttable presumption that goods were sold within the State if the transit pass is not delivered at the exit check-post. That presumption was displaced where the assessee produced material showing that the goods had in fact moved outside the State and were accounted for at the destination, including the consignor's final assessment record and other official material. Once the revenue failed to establish an intra-State sale, the foundation for restoring tax and penalty fell away, and the revisional authority was held to have inadequately dealt with the rebuttal evidence.

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Issues: Whether the presumption arising on non-delivery of the transit pass under section 18B was rebutted on the facts, and whether the revisional authority was justified in restoring the tax and penalty.

Analysis: Section 18B creates a statutory presumption that goods are sold within the State if the driver or person in charge fails to deliver the transit pass at the exit check-post, but the presumption is rebuttable. The assessee produced material showing that the goods were actually moved outside the State and accounted for at the destination, including the assessment record of the consignor and related official material. Once the assessment of the consignor had reached finality and the revenue failed to establish an intra-State sale, the basis for invoking the presumption against the transporter was displaced. The revisional authority did not effectively deal with the rebuttal evidence before interfering with the appellate order.

Conclusion: The presumption was rebutted and the revisional order restoring tax and penalty was unsustainable.

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