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2021 (6) TMI 514 - HC - VAT and Sales TaxValidity of assessment order - inclusion/ addition of coffee husk in the total turnover of the petitioner - omissions or suppressions by the dealer in maintenance of record or production of records, registers, etc. - HELD THAT:- Pre-assessment notice was issued on September 24, 2013, reply dated October 8, 2013 was received on October 9, 2013 by the assessing officer and on October 9, 2013 order in annexure A was made by the assessing officer. Reference to these three dates is made to demonstrate that the Commercial Tax Officer just by receiving the reply on October 9, 2013 has made the order in annexure A. Apparently, order in annexure A is not preceded by enquiry of any sort - The principle laid down by this court in SUZION INFRASTRUCTURE SERVICE LTD. VERSUS CTO [2010 (6) TMI 677 - KERALA HIGH COURT] has been considered by this court in other reported decisions on which the petitioner is relying upon - the order in annexure A is vitiated for not holding enquiry, illegal and is liable to be set aside. Non-consideration of sales turnover of husk - HELD THAT:- The assumption that coffee husk is generated as coffee seed are sold, coffee husk could also be sold and that the dealer is liable to pay tax thereon, is illegal and unsustainable. The orders in annexures A to C do not consider the issue on the lines discussed above and certainly are based on assumption of sale of coffee husk by the dealer. The liability under the Act arises only in the manner and mode the dealer comes under obligation to pay tax, but not otherwise. The generation of residue such as coffee husk and sale or transfer of goods in any manner contemplated by the Act, certainly attract the incidence of tax, but not as noted above, i. e., generation and self-consumption. Being an indirect tax, the dealer, for self- consumption of coffee husk, is not obligated to include in turnover or pay VAT. The Department certainly failed in establishing that in the case on hand, the coffee husk is not consumed for self, but was sold by the dealer. The Tribunal, while examining this aspect, calls upon the dealer to prove that the dealer has not sold the coffee husk. The fact that concurrent findings are recorded is not reason to list the legal contention with fundamental principles involved in indirect taxation, and the findings when examined in this perspective fail to convince this court. The proposed inclusion of coffee husk in the turnover of dealer for the subject assessment years is unsustainable and illegal and the dealer has produced the account registers for which the assessing officer proposes to passing separate order under the CST Act - the omission or suppression noted is an ancillary circumstance following the main allegation in non-disclosure of coffee husk - the order in annexure A as modified by the order of Tribunal are liable to be set aside - revision allowed.
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