allahabad high court

Allahabad High Court: In a sales tax revision filed against the judgment and order dated 26-05-2022 passed by Commercial Tax Tribunal for the assessment year 2013 — 2014, Piyush Agrawal, J. while dismissing the revision, has held that the burden to prove that concession is upon the assessee in original proceedings. However, in reassessment proceedings, the burden shifts upon the department to prove that the assessee had wrongly claimed the concession.


The applicant made central sale amounting to Rs. 5,43,43,928/- of Form C. The revisionist made central sale to Yash Traders and claimed concession rate on the strength of Form C. The said claim was stated to be covered by 23 invoices to the tune of Rs. 2,11,47,201/-. The Assessing Authority, at the time of framing the assessment order, sought a verification of the said form from sale tax authorities at Rajasthan, to which a report was submitted, that only one transaction for a sum of Rs. 2,75,094/. has been disclosed by the purchasing dealer. On getting the said information, the Assessing Authority, while passing the assessment order dated 19-01-2019, accepted the one sale made to the said party and granted concession, but imposed higher rate of tax on other 22 sales. Aggrieved against the said order, the applicant preferred to appeal to the Tribunal, which has dismissed vide order dated 26-05-2022. Hence, this revision was filed.


Whether on the facts and circumstances of the case, the Tribunal was correct in giving benefit of central sale against Form C amounting to Rs. 2,75,094/- instead of Rs. 2,11,47,201/- received from Yash Traders, mentioning the utilization of list of 23 sales invoices on the back of Form C?


The Court noted that the sales have been disclosed by the revisionist through 23 invoices for a sum of Rs. 2,11,47,201/- to Yash Traders, for which Form C has been submitted, but on verification from the corresponding State (Rajasthan), the information was given that the purchasing dealer has only shown purchase against one invoice dated 12-12-2013 for a sum of Rs. 2,75,049/-. The benefit of concession has been given to the revisionist for the said invoice. So far as the other 22 invoices are concerned, the same have been disbelieved.

The Court further noted that the present proceeding is an original proceeding, that is the revisionist is claiming concession rate on the strength of Form C. Further, it said that once the corresponding State authority has sent information that only one purchase made by the purchasing dealer could be verified, the benefit of other purchases as alleged to be made by the revisionist against the said Form C cannot be granted.

The Court referred to ITC Ltd. v. CCE, (2004) 7 SCC 591, wherein it was held that the Assessing Authority is competent to scrutinize the certificate to find out the contents to be genuine and is competent to inquire about the contents of the certificate to satisfy itself that the goods purchased are verifiable. Once the truth of declaration on verification was not found to be correct, the benefit cannot be granted.

Thus, the Court held that the revisionist has failed to discharge its burden by any cogent material.

[Amrit Steels v Commissioner Commercial Tax, 2023 SCC OnLine All 2002, Order dated 04-10-2023]

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