Burden of proof under trade tax law sustained manufacturer classification where purchases from registered dealer were not proved.

Under section 2(ee) of the U.P. Trade Tax Act, a dealer making the first sale after manufacture may be treated as a manufacturer, and section 12A places on the assessee the burden of proving facts especially within his knowledge. Where the assessee failed to produce reliable material showing that the disputed goods were purchased from a registered dealer within Uttar Pradesh, the statutory presumption could be drawn against him. On that evidentiary basis, the dealer was treated as a manufacturer and the levy at 12% was sustained.

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Issues: Whether the assessee was liable to be treated as a "manufacturer" under section 2(ee) of the U.P. Trade Tax Act, 1948, and subjected to tax at 12%, in view of the failure to establish that the goods were purchased from a registered dealer within the State.

Analysis: Section 2(ee) treats as a manufacturer the dealer who makes the first sale of goods in the State after manufacture, and section 12A places the burden on the assessee to prove facts especially within his knowledge, with a corresponding presumption against non-disclosure. The assessee's books and explanation were not accepted, and he failed to adduce reliable material to show that the disputed goods were purchased from a registered dealer within Uttar Pradesh. On the available record, the factual finding that the purchases were not proved as claimed was one of appreciation of evidence and supported the inference drawn by the authorities.

Conclusion: The assessee was rightly treated as a manufacturer under section 2(ee), and the levy at 12% was sustained.

Ratio Decidendi: Where the fact necessary to exclude liability is within the assessee's special knowledge, section 12A shifts the burden onto the assessee to prove it, and failure to do so permits the authority to draw the statutory presumption and assess the dealer accordingly.

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