1969 (7) TMI 103 - HC - VAT and Sales Tax

Summary

Issues:
Interpretation of section 5(2)(A)(a)(ii) of the Orissa Sales Tax Act, 1947 regarding deductions for sales to registered dealers intended for resale in Orissa. Determination of the burden of proof on the assessee to establish the genuineness of declarations provided for deductions. Evaluation of whether the assessing officer can reject declarations as fictitious without further proof.

Analysis:
The judgment by the Orissa High Court involved eight references concerning deductions claimed by a wholesale textile dealer under section 5(2)(A)(a)(ii) of the Orissa Sales Tax Act, 1947. The dealer sought deductions for sales to registered dealers intended for resale in Orissa. The Sales Tax Officer doubted the genuineness of declarations provided by the dealer and refused the deductions. The Assistant Commissioner allowed the deductions, but the Tribunal upheld the Sales Tax Officer's decision, stating that the burden of proof lies with the assessee to establish the genuineness of declarations.

The Court referred to the relevant provisions of the Act and previous judgments to clarify the burden of proof on the assessee. It emphasized that the burden is on the assessee to prove the genuineness of declarations for claiming exemptions. The Court highlighted that even if the purchasing dealer is genuine, the assessee must prove the authenticity of the declarations. The Tribunal found that the alleged purchasing dealers were fictitious, leading to the rejection of deductions.

The Court reiterated that the burden of proof always rests with the assessee to establish the authenticity of declarations. If a declaration appears fictitious, the assessing authority can reject it unless the assessee proves its genuineness. The Court concluded that the questions raised were not legal but related to the evidence required to prove a fact in issue, emphasizing the importance of establishing the authenticity of declarations for claiming deductions.

In conclusion, the Court answered the references, emphasizing the assessee's burden to prove the genuineness of declarations and the authority's right to reject declarations if they appear fictitious. The judgment clarified the requirements for claiming deductions under the Orissa Sales Tax Act and upheld the decision to disallow deductions due to fictitious purchasing dealers.