1975 (9) TMI 60 - HC - VAT and Sales Tax

Summary

Issues:
Assessment of tax under the Central Sales Tax Act for the Diwali year 1970-71 based on 'C' form submission, rejection of secondary evidence, interpretation of rules regarding declaration forms, acceptance of photostate copy and certificate as evidence, comparison with precedent set by Shansshila Oil Mills vs. State of Madras, and decision on appeal.

Analysis:
The appellant, a bidi dealer, was assessed for tax under the Central Sales Tax Act for the Diwali year 1970-71, with a gross turnover of Rs. 7,01,635-56. The dealer submitted a photostate copy of a 'C' form for Rs. 1,13,182-20, issued to M/s. Jaswantlal Prahladbhai & Co., Nizamabad, which was rejected by the assessing authority. The appellant's appeal was dismissed by the first appellate authority, leading to a second appeal before the Tribunal. The appellant contended that due to circumstances where both the original and duplicate 'C' forms were lost in transit and the Nizamabad dealer had wound up business, secondary evidence in the form of a photostate copy and a certificate from the Commercial Tax Officer should have been accepted.

The rules regarding declaration forms, specifically R.8 to R. 8-F of the M.P. Sales Tax (Central) Rules, 1957, were examined. Rule 8 mandates the process of obtaining, filling, and submitting 'C' forms by purchasing and selling dealers. In this case, both the original and duplicate 'C' forms were lost in transit, necessitating the obtaining of another duplicate from the purchasing dealer, who had deposited all 'C' forms with the Sales Tax Department upon winding up the business. The appellant obtained a photostate copy of the counterfoil and a certificate from the Commercial Tax Officer as evidence of the transaction.

The judgment referred to the precedent set by Shansshila Oil Mills vs. State of Madras, where a similar situation arose regarding the loss of a 'C' form in transit. The Madras High Court in that case emphasized that the time factor for filing 'C' forms should be reasonably construed and accepted a photostate copy as authentic evidence. Drawing from this precedent, the High Court of Madhya Pradesh in the present case acknowledged the authenticity of the photostate copy and the certificate from the Commercial Tax Officer. Given the unique circumstances of both original and duplicate 'C' forms being lost and the purchasing dealer's inability to issue a duplicate, the Court allowed the appeal and remanded the case to the assessing authority for further action based on the photostate copy and certificate.

In conclusion, the judgment highlights the importance of considering secondary evidence, such as a photostate copy and a certificate from a tax authority, in situations where original documents are lost or unavailable. It underscores the need for a flexible approach in interpreting rules related to declaration forms and emphasizes the significance of authenticating evidence to establish transactions for tax assessment purposes.