AI Drafter 
TaxTMI 
TaxTMI 
1995 (10) TMI 220
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....d by the assessee. 2.. National Iron Traders is a dealer in iron scrap. The assessee was reassessed for the year 1978-79 under the Tamil Nadu General Sales Tax Act (the TNGST Act, 1959) by the Deputy Commercial Tax Officer on a turnover of Rs. 2,39,705.92, being the purchase of iron and steel goods which had not suffered tax at prior stage. Aggrieved by the revised assessment the assessee filed an appeal before the Appellate Assistant Commissioner. The Appellate Assistant Commissioner took the view that when the dealer deals with another, it was too much to expect that he should find out whether the others business was continuing or not. He therefore allowed the appeal in respect of the purchase made from Jayachandra Traders. 3.. Acco....
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....roceeding on the basis that merely because Jayachandra Traders from whom the scrap was purchased by the assessee were not registered dealers under the TNGST Act during 1978-79, the sales by the assessee will be liable to be taxed as the first sales. The bills issued by Jayachandra Traders clearly showed that the sales by them were not second sales. Iron and steel are goods which are amenable for tax at the point of first sale in the State. The assessee purchased the said iron from local dealer after paying necessary local tax on the purchases and hence unless and until it is established that the said seller, i.e., Jayachandra Traders had not paid the tax, the question of treating the sales by the assessee as first sale does not arise. Me....
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.... should find out whether the others business was continuing or not. It is only on a perusal of the connected records the Joint Commissioner came to the conclusion that the Appellate Assistant Commissioner was not correct in allowing the appeal with regard to the purchases made with Jayachandra Traders. It was therefore contended that the order passed by the Joint Commissioner is in order. 6.. We have heard the rival submissions. The assessee, National Iron Traders is a dealer in iron scrap, having place of business at Coimbatore. The assessing officer revising the order already made and confirmed the turnover at Rs. 2,39,705.92 stating that the purchases made from Jayachandra Traders and Dinakar Traders are not genuine and are not....
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..... Jayachandra Traders in the said place. Two sale bill books and 10 loose bills with the name of the seller Tvl. Jayachandra Traders with the address 13/56, West Thiruvenkatasamy Road, R.S. Puram, were recovered. From this report it is clear that in the address given by Jayachandra Traders at No. 13/56, West Thiruvenkatasamy Road, there is a business run by Jayachandran, S/o. Komarasamy Asari. The inspecting officers have not probed further and not taken any statement from the said Jayachandran with regard to his dealings. From the inspection report it is clear that Jayachandra Traders is carrying on business in selling scrap and it is for the department to take action against him. It was pointed out that the R.C. number of Jayachandra Trad....
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.... 8.. In [1983] 52 STC 124 (Mad.) in the case of State of Tamil Nadu v. Chamundeswari Enterprises it was held that if a sale effected by an assessee is not a first sale, which is only taxable under the Tamil Nadu General Sales Tax Act, 1959, then under the provisions of the Act that sale cannot be brought within the net of taxation and it is for the Revenue to search out the first seller and levy tax on the first sale. It is not for the assessee, who is the subsequent seller, to show that the first sale has been taxed. The onus on the subsequent seller is only to point out that there has been a first sale and the onus is not on him to show that the first sale has, in fact, suffered tax. 9.. In [1984] 57 STC 137 in the case of State of ....