1972 (3) TMI 69 - SUPREME COURT

Whether under the provisions of the Kerala General Sales Tax Act, 1963 the opportunity of being heard which was to be given to the assessees, would include within its sweep the right of cross-examination of a third party whose accounts were the basis of the best judgment assessments made by the Sales Tax Officer and the examination of which later on showed that the returns filed by the assessees were incorrect and incomplete?

Held that:- Appeal dismissed. On a true interpretation of section 17(3), the proviso thereto and rule 15, the inescapable conclusion would be that the assessee has been given a statutory right to prove the correctness of his return by showing that the materials on the basis of which his return is found to be incorrect or incomplete are wrong and if for this purpose the assessee makes an express prayer for cross-examining the wholesale dealers whose accounts formed the sheet-anchor of the notice issued to the assessee, he is undoubtedly entitled to cross-examine such wholesale dealers. In view of the language in which the Rules are couched it seems to us that a determinative issue arises in this case-the department taking the stand that the returns filed by the assessees are incorrect and incomplete, whereas the assessees contend that their returns are correct and that the accounts of the wholesale dealers which formed the basis of the information of the sales tax authorities were wrong and incorrect.