1994 (11) TMI 376

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....holding the order of cancellation in appeal has also been impugned primarily on the ground that the petitioner was not afforded a reasonable opportunity by the Assessing Authority to prove its case. The petitioner (hereinafter referred to as "the dealer") is a proprietorship concern which carried on the business of sale and purchase of watches at Batala, District Gurdaspur in the State of Punjab and was registered as a dealer with the Assessing Authority, Batala, under the State Act and the Central Act. The Assessing Authority, Batala, had reason to believe that the dealer made purchases of goods worth lacs of rupees from M/s. Hyderabad Allwyn Ltd., SCO No. 371-72, Sector 35-D, Chandigarh, during the period from May 31, 1984 to July 31, 19....

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....received payments of more than rupees nine lacs from the dealer against those sales and the details of the demand drafts as well as cheques were also given in the affidavit. Shri R.N. Sikka also filed along with his affidavit the photo copies of the acknowledgements of receipt of goods in question showing that the goods had been duly received by the dealer. The receipts are alleged to have been signed by the proprietor of the dealer-firm. He also filed photo copies of agreement/guarantee bond and promissory note signed by the proprietor of the dealer and also a photo copy of the civil suit filed by M/s. Hyderabad Allwyn Ltd., against the dealer for the recovery of the balance amount due to it. As already observed earlier, the dealer had als....

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....n fact relates to the dealer himself. The receipts of goods and dishonoured cheques, promissory notes, etc., were made by the dealer himself and not by Hyderabad Allwyn Ltd., Chandigarh." The Assessing Authority then relying upon the affidavit of Shri Sikka and the photo copies of the receipts allegedly issued by the dealer came to the conclusion that the dealer had entered into a contract of trade with M/s. Hyderabad Allwyn Ltd., Chandigarh and received goods from them against payments. It was further held that the dealer failed to file its quarterly return after December 31, 1984 and suppressed purchases made from M/s. Hyderabad Allwyn Ltd., leading to massive evasion of tax and for this reason, the registration certificates of the deale....

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....etitioner for cross-examining Shri Sikka was that the material produced by the said Shri Sikka in fact related to the dealer itself. In our opinion, this was not the right approach. The Assessing Authority which was discharging quasi-judicial functions was seeking to rely upon the affidavit of Shri Sikka and the photo copies of the alleged receipts acknowledging the receipt of goods by the dealer without having a look at the originals. All this material was being produced from a third party and, therefore, the assessee was entitled to have Shri R.N. Sikka summoned as a witness for cross-examination as that is one of the most efficacious methods for establishing truth and exposing the falsehood. May be, the assessee could have succeeded in p....