TaxTMI 
TaxTMI 
2009 (4) TMI 865
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....year 1981-82, the petitioner was assessed under section 12(4) of the OST Act. On receipt of a fraud report No. 6 of 1983-84 from Vigilance Wing of Sambalpur, the original assessment was reopened by the Sales Tax Officer, Bolangir I Circle, Bolangir (hereinafter called "the assessing officer") under section 12(8) of the OST Act. In response to the said notice, the petitioner appeared before the assessing officer. In course of assessment proceeding, the assessing officer confronted the petitioner to the extract of account of M/s Radheshyam Satyanarayan of Kantabanji (hereinafter called "M/s RSK") alleging that the petitioner carried on paddy transaction with said firm as there was mention of "Babulal" in the said seized document and the same was not disclosed to the Department. In reply, the petitioner denied having any such transaction with M/s. RSK. The petitioner further stated before the assessing officer that there were so many "Babulals" in Bolangir district. He demanded confrontation with M/s. RSK from whom books of account were seized wherein "Babulal" had been mentioned. The petitioner further explained to the assessing officer that he did not appear before the vigilance aut....
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....rden, the assessment must have been made in a fair manner. The assessee should be given an opportunity to rebut the allegations so made before the same are utilized against him. Mr. R.P. Kar, learned Additional Standing Counsel appearing for the Revenue, on the other hand, supports the order of the learned Tribunal. Rule 31 of the Orissa Sales Tax Rules, 1947 deals with order of assessment. It provides that after considering any objection raised by the dealer either personally or through an agent or by means of a representation in writing and also any evidence produced in support thereof and the report, if any, of the Inspector deputed under rule 29, the Commissioner shall assess the amount of tax and penalty, if any, payable by the dealer, and shall also record an order of assessment. In State of Kerala v. K.T. Shaduli Yusuff [1977] 39 STC 478 (SC), during assessment proceedings, the returns filed by the assessee on the basis of his books of account appeared to the Sales Tax Officer to be incorrect and incomplete since certain sales appearing in the books of account of one H as having been effected by the assessee in his favour were not accounted for in the books of account ....
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....ainst an assessee, adequate opportunity has to be granted to it to rebut the same before the material can be utilized against the assessee. For that purpose, it is open to the assessee to make prayer for summoning a person who has nexus with the material sought to be utilized, so that the witness can throw light on the materials. For example, if a third party's accounts are sought to be utilized the assessee can pray the Sales Tax Officer to issue summon to the party whose accounts are sought to be relied upon. Denial to accept the prayer would amount to violation of the principles of natural justice. The person whose accounts are sought to be utilized against the assessee stands in the footing of a witness for the Revenue. Utilisation of any entry in his account against the assessee without accepting prayer for summoning him would vitiate the assessment. The action of the assessing authority in refusing to summon the third party constituted an infraction, and vitiated the orders of assessment. In Kanak Cement Pvt. Ltd. v. Sales Tax Officer, Assessment Unit, Rajgangpur [1997] 105 STC 112 (Orissa), it has been held that it is a fundamental requirement of the principles of nat....
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....s vitiated. This court, in Income-tax Appeal No. 5 of 2002 (Commissioner of Income-tax, Sambalpur, Orissa v. Utkal Alloys Limited, Rourkela disposed of on March 19, 2009, [2009] 319 ITR 339) held that the procedure of assessment is quasi-judicial in nature and in making the assessment the assessing officer must observe the judicial principles. Accounts regularly maintained in course of business have to be relied upon unless there are strong and sufficient reasons to disbelieve them. The issue involved in the present case is to be examined in the light of the above legal propositions. Admittedly, in response to notice under section 12(8) of the OST Act issued by the assessing officer, the petitioner appeared before him and denied the allegations of sale suppression of paddy made in the fraud case report submitted by vigilance authority. The petitioner also demanded confrontation with M/s. RSK from whom the Vigilance authority seized books of account wherein "Babulal" had been mentioned. However, without allowing confrontation, the assessing officer utilized the same against the petitioner in the assessment order. The assessing officer has also utilized the statement ....