TMI Blog2008 (12) TMI 687X X X X Extracts X X X X X X X X Extracts X X X X ..... inspecting officer shall supply copies of the seized regular books of account and incriminating material(s) to the dealer if he asks for the same before asking the dealer for furnishing his explanation in connection with any proceeding under the OVAT Act.Since the learned counsel for the petitioner submits that he has already appeared before the assessing officer with books of account, we direct the assessing officer to verify the books of account of the relevant years with reference to the seized materials and the report. While doing so he will confront the report and the seized materials to the petitioner and record a preliminary statement with regard to such verification. - W.P. (C) No. 16741 of 2008 - - - Dated:- 6-12-2008 - CHAUHAN B.S. DR. C.J. AND MAHAPATRA B.N. , JJ. The judgment of the court was delivered by B.N. MAHAPATRA J. In this petition, the petitioner challenges the inaction of the opposite party No. 1, Sales Tax Officer, Rayagada Circle, Rayagada (hereinafter called as, the assessing officer ) in supplying certified copies of three slips and thirty-six written pages of one diary taken away by the Vigilance Sales Tax Squad of Berhampur Vigilance Divisi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or through authorized agent and to produce books of account on October 25, 2008. The said notice was accompanied by copy of the tax audit report. In response to the said notice, the petitioner moved a petition seeking adjournment for forty-five days on the ground that his accountant had gone to Tirupati and the managing partner, Shri B.S. Jain, had been suffering from high blood pressure with diabetes and was advised to take rest. Considering the said petition, the assessing officer re-fixed the date to November 11, 2008 for production of the books of account for verification. In the meanwhile, on July 18, 2007, the petitioner asked for certified copies of the statements and seized documents mentioned in annexure 1. On November 4, 2008, the petitioner also applied for certified copy of the report submitted by the CTO (V). The assessing officer issued certified copies of the statements recorded on March 12, 2008 and March 24, 2008 but did not issue certified copies of the seized documents such as the three slips, thirty-six written pages of the diary and the certified copy of the report submitted by the CTO (V). Hence, the present writ petition. Mr. G. Padhi, learned counsel app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessing officer is justified in not supplying certified copies of the seized documents before production of the books of account. Mr. Kar places reliance on the decisions of this court in Kanak Cement Pvt. Ltd. v. Sales Tax Officer, Assessment Unit, Rajgangpur [1997] 105 STC 112 and Mitra Trading Company v. Commissioner of Sales Tax, Orissa (O.J.C. No. 252 of 1968 dated November 9, 1971). On rival contentions of the respective parties, the questions which fall for consideration by this court are as follows: (i) Whether a dealer is entitled to be supplied with the materials intended to be used against him in the assessment proceeding for his rebuttal? (ii) Whether, on the facts and in the circumstances of the case, the assessing officer is justified in insisting upon production of books of account for verification before issuing certified copies of the seized documents, i.e., three written slips and thirty-six written pages of the diary seized from the business premises of the petitioner during surprise inspection? So far as the first question is concerned, law is well-settled that if any person is likely to be affected by the use of any material against him those ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to facilitate assessment even by private enquiry. But if he desires to use the material so collected, the assessee must be informed of the material and must be given an adequate opportunity of explaining it. In Kishinchand Chellaram v. Commissioner of Income-tax, Bombay City II [1980] 125 ITR 713, the honourable apex court held that it was true that proceedings under the income-tax law were not governed by the strict rules of evidence, and, therefore, it might be said that even without calling the manager of the bank in evidence to prove the letter dated February 18, 1955, it could be taken into account as evidence. But before the Income-tax authorities could rely upon it, they were bound to produce it before the assessee so that the assessee could controvert the statements contained in it by asking for an opportunity to cross-examine the manager of the bank with reference to the statements made by him. This court in J.S. Refineries Ltd. [1998] 109 STC 16 held that any material sought to be utilized against the dealer has to be brought to his notice. This court in Geeta Industries Ltd. [1996] 100 STC 48 held that refusal to grant a certified copy of the order sheet so fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n assessment proceeding for rebuttal and the dealer's explanation with regard to those materials is bound to be considered by the assessing officer in the assessment order either accepting or rejecting the same. The second question relates to the stage at which the copy of the seized documents should be supplied to the petitioner-dealer. Should it be supplied before or after production of books of account for verification by the assessing officer? We should keep in mind that in order to plug the leakage of revenue the fiscal statutes provide various measures to be taken by the departmental officers including surprise visit to the place of business, audit visit, establishment of check-post, inspection of goods in transit, etc. Pursuant to such provisions, very often departmental officers used to pay surprise visit to the business premises of the dealer to find out whether all the transactions effected by a dealer in his day-to-day business are recorded in his regular books of account maintained for the purpose of paying tax. It is not uncommon that unscrupulous businessmen who effect purchase and sale outside the regular books of account keep note of the same in some slips/ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the plea that the same were with its accountant for the purpose of filing return. Section 61(2) provides that a dealer registered under the OVAT Act shall keep his books of account at the place of his business. Thus, the petitioner violated the said provision by not keeping the books of account at the place of his business during inspection. However, on March 24, 2008 the petitioner produced the books of account only for the year 2007-08 before the CTO (V) and on that date the seized materials were confronted to him and statement was recorded from the petitioner. Admittedly, no books of account was produced before the CTO (V) for the period 2005-06 and 2006-07 on March 24, 2008. In the writ petition, the petitioner in paragraph 3(b) states that the CTO (V) has recorded statement from the managing partner of the firm as per his sweet will and pleasure and forced him to put his signature. Even after receiving the notice from theassessing officer to produce the books of account, no books of account was produced before the assessing officer till the date of filing of this writ petition on November 14, 2008. The honourable apex court in GKN Driveshafts (India) Ltd. v. Incometax Of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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