Genuine C-Forms required for concessional inter-State sales tax; bogus or unverifiable forms justify reassessment and penalty.

Concessional inter-State sales tax treatment was held unavailable where the C-Forms relied upon were verified as bogus, unissued, unverifiable, or materially discrepant. The High Court noted that the reassessment rested on reports from the issuing tax authorities, and that the assessee, despite notice and opportunity, failed to prove the authenticity of the forms or compliance with the statutory conditions for the concession. On that basis, the reassessment, differential tax, and penalty were upheld, and the challenge failed.

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Issues: Whether reassessment and penalty could be sustained where the assessee had claimed concessional inter-State sales tax benefit on the basis of C-Forms that were found to be not genuine or not verified by the issuing authorities.

Analysis: The reassessment was founded on verification reports received from the concerned tax authorities of other States, which showed that several C-Forms were not issued by the offices concerned and that the remaining forms were either unverifiable or reflected material discrepancies. The assessee was given notice and opportunity, but failed to produce material to establish the authenticity of the forms or to show that the statutory requirement for claiming concessional tax treatment had been satisfied. In these circumstances, the Court applied the principle that concessional tax benefit is available only when the transaction is supported by genuine statutory forms, and that the selling dealer cannot retain such benefit when the forms are found to be bogus or invalid.

Conclusion: The reassessment and levy of differential tax and penalty were upheld, and the challenge by the assessee failed.

Final Conclusion: The writ petitions did not disclose any ground for interference because the impugned assessment was supported by verification material showing invalid or unissued C-Forms, and the concessional tax benefit was therefore rightly withdrawn.

Ratio Decidendi: A selling dealer is not entitled to concessional inter-State sales tax treatment where the C-Forms relied upon are shown by verification to be bogus, unissued, or otherwise invalid, and reassessment based on such verification is sustainable if due opportunity has been afforded.

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