Penalty for false bills upheld where exemption claim rested on factual findings that could not be reopened in revision.

Penalty under Section 7-A(2) of the Andhra Pradesh General Sales Tax Act was held attracted where false bills were found to have been produced to support a claim that turnover was exempt as a second sale. The dealer's challenge failed because the findings that the bills were produced and the exemption claim was made were treated as questions of fact, which could not be reopened in revision under Section 22(1) except on a question of law. Authorities cited on Section 14 were held inapplicable.

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Issues: Whether penalty under Section 7-A(2) of the Andhra Pradesh General Sales Tax Act, 1957 could be sustained on the basis that false bills were found and relied upon to claim exemption as second sale, even though the dealer disputed their production before the assessing authority.

Analysis: Section 7-A(2) applies when a dealer issues or produces a false bill, voucher, declaration, certificate or other document with a view to support a claim that a transaction is not liable to tax or is liable to tax at a reduced rate. The record showed that the dealer claimed exemption on part of the turnover, the departmental authorities recorded that false bills were produced, and no effective rebuttal was made before the assessing authority. Whether the bills were produced and whether the claim of exemption was made were treated as factual matters. In revisional jurisdiction under Section 22(1), interference is confined to questions of law and does not extend to disputed questions of fact. The authorities relied upon by the dealer concerned penalty under Section 14 and were held inapplicable to Section 7-A.

Conclusion: The penalty under Section 7-A(2) was held to be valid and the revision failed.

Ratio Decidendi: Penalty under Section 7-A(2) is attracted when the dealer issues or produces a false document to support a tax exemption claim, and such factual findings cannot be reopened in revision under Section 22(1) except on a question of law.

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