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2019 (4) TMI 1637 - MADRAS HIGH COURTJurisdiction - inter-state sales - Whether in facts and circumstances of the case, there is any jurisdiction to infer estimation of an inter-State sale under the Central Sales Tax Act, 1956 in the absence of any evidence of movement against a particular order or direction? - levy of penalty under Section 16(2) of the Act. HELD THAT:- The right to cross examination will occur only after the witnesses are examined in chief. Therefore, when notice is issued to the third parties by the Assessing Officer, the first requirement is to record a statement from the said person so summoned, after the statement is recorded and if there is any adverse remarks is made by the said third party, then the assessee is entitled to cross examine the third party on the imputations made by the third party against the petitioner/dealer. Unfortunately, the Tribunal did not make a follow up exercise to consider as to whether the findings are correct or not but was carried away by the findings of the Assessing Officer which infact was set aside by the First Appellate Authority. The Tribunal was expected to independently assign reasons as to why it is confirming or setting aside the order of the First Appellate Authority. The Tribunal also committed a serious error by drawing adverse inference against the petitioner/dealer on account of the absence of transporters before the Assessing Officer. It is the duty of the Department to record statement from the transporters and if there is any imputation against the petitioner/dealer, then he has to be afforded an opportunity to cross examine the third party before the statement can be relied on. The third party having not appeared before the Assessing Officer, the question of drawing adverse inference against the petitioner/dealer does not arise. Tax case revision allowed.
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