Sales tax exemption on declaration forms depends on proof of issuance and supporting records; untraceable dealer defeats the claim.

Exemption against sales claimed on Forms 3-A depends on proof that the forms were actually issued by the alleged dealer and that the record supports the claim. For sales to M/s. Kishan Lai Padam Kumar, Muzaffarnagar, the exemption was disallowed because the forms were not issued to the assessee and the dealer was untraceable. For sales to M/s. National Iron Depot, Haldwani, the exemption was allowed because the firm was registered, the forms were issued, and its existence was not disputed; the claim was accepted to the extent supported by the disclosed sales record.

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Issues: (i) Whether the assessee was entitled to exemption on sales claimed against Forms 3-A in respect of sales to M/s. Kishan Lai Padam Kumar, Muzaffarnagar. (ii) Whether the assessee was entitled to exemption on sales claimed against Forms 3-A in respect of sales to M/s. National Iron Depot, Haldwani.

Issue (i): Whether the assessee was entitled to exemption on sales claimed against Forms 3-A in respect of sales to M/s. Kishan Lai Padam Kumar, Muzaffarnagar.

Analysis: The Tribunal had found that the forms were not issued to the assessee by the Muzaffarnagar firm and that the firm had become untraceable. On that factual finding, the claim for exemption could not be sustained.

Conclusion: The disallowance of exemption on the sales to M/s. Kishan Lai Padam Kumar, Muzaffarnagar, was upheld.

Issue (ii): Whether the assessee was entitled to exemption on sales claimed against Forms 3-A in respect of sales to M/s. National Iron Depot, Haldwani.

Analysis: The firm was found to be registered, the forms were issued, and its existence was not disputed. The Tribunal had itself accepted the exemption to the extent supported by the Haldwani party's disclosed sales. The rejection of exemption for the remaining amount was therefore not justified.

Conclusion: The assessee was held entitled to exemption on Rs. 2,13,592.90 relating to M/s. National Iron Depot, Haldwani.

Final Conclusion: The revision succeeded only to the extent of the exemption relating to M/s. National Iron Depot, Haldwani, while the disallowance relating to the other firm was maintained.

Ratio Decidendi: Exemption against declaration forms cannot be denied where the issuing dealer and issuance of the forms are established and the claim is otherwise supported by the record; conversely, a claim fails where the forms are found not to have been issued by the alleged dealer and the dealer is untraceable.

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