Transporter tax liability on completed consignments requires statutory authority or proof of trading activity, not adverse inference alone.

Section 8-A(5) of the U.P. Trade Tax Act applies only when goods are in transit and prescribed transport documents are demanded for inspection under Section 13(2), creating only a rebuttable presumption at that stage. It does not support an adverse inference after transportation is complete, and Rule 84-A of the U.P. Trade Tax Rules does not create an independent presumption against the transporter. A transporter, as bailee of the goods, can be taxed only where a statute expressly imposes liability or where evidence shows it was itself engaged in trading activity. Completed consignments cannot be assessed on the mere non-furnishing of consignor and consignee details.

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Issues: Whether, in the absence of a statutory provision applicable to completed transportation transactions, tax liability could be fastened on a transporter merely because it did not furnish the consignor and consignee details of completed consignments, and whether the best judgment assessment based on such adverse inference was sustainable.

Analysis: Section 8-A(5) of the U.P. Trade Tax Act, 1948 operates only where goods are in transit and the prescribed documents are demanded for inspection under Section 13(2) of the same Act. The provision creates a rebuttable presumption only on failure to produce transport documents at that stage. It does not authorise an adverse inference after the transportation is complete, nor does Rule 84-A of the U.P. Trade Tax Rules, 1948 create any independent presumption against the transporter. A transporter is only a bailee of goods, and tax liability on its hands can arise only if a statutory provision exists or if evidence establishes that it was itself engaged in trading activity. In the absence of such provision or evidence, the revenue could not treat non-furnishing of consignor and consignee particulars as proof of trading.

Conclusion: The question of law was answered in favour of the assessee and against the revenue. The best judgment assessment and turnover quantification based solely on adverse inference were unsustainable.

Ratio Decidendi: A transporter cannot be subjected to tax on completed consignments merely for not furnishing consignor and consignee details unless the statute expressly authorises such liability or the revenue proves that the transporter itself carried on trading activity.

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