TMI Blog2021 (11) TMI 435X X X X Extracts X X X X X X X X Extracts X X X X ..... eveals that two dealers from which tax paid purchases has been shown by the revisionist are namely; M/s Singh Stone Mill, Kabrai, Mahoba and M/s Mahashakti Stone Mill, Kabrai, Mahoba. There is no information whatsoever contrary to the material on record. So far as M/s Singh Stone Mill for disbelieving the purchases made by the dealer is concerned, the only information has been received that the selling dealer has neither produced bill book nor has given the details of sale list. From the perusal of the record it shows that there is no material which could be attributed that the wrong claim having been made by the revisionist. The revisionist had admittedly shown purchases of gitti against the cash memo which has not been disbelieved at any stage. The reassessment proceeding has only been initiated as the selling dealer has not shown the cash memo and the sale list. There is no finding of any material so far as M/s Mahashakti Stone Mills as no enquiry what soever has been brought on record. The initiation of reassessment proceeding is bad. Further once the revisionist has brought on record by means of an application under section 12-B of the Act before the Tribunal that the Bi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e construction of road in the civil work contract performed during the assessment year 2001-02. Brief facts of the case are that the revisionist is engaged in the business of purchase and sale of Gitti as well as stone grit, stone ballast, supply of fire wood and labour work as well as civil contractor. The original assessment order was passed by the assessing authority on 4.2.2006. The claim of revisionist was accepted so far as Gitti of ₹ 511260/- purchased from the registered dealer. Thereafter reassessment proceedings were initiated and the proposal dated 1.9.2006 was sent by the assessing authority on the ground that the purchases of ₹ 511260/- shown from the registered dealer are not verifiable. The Additional Commissioner, Grade I-Allahabad Zone, Allahabad by order dated 15.11.2006 granted permission to reopen the complete assessment. After permission, the assessing authority issued notice dated 5.7.2007. Thereafter the assessing authority by its order dated 1.9.2007 has passed the reassessment order imposing tax of ₹ 65951/- on Gitti as well as ₹ 40,000/- on the supply of coal tar. The revisionist contested the matter upto the Tribunal unsuccessf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bill book nor has given the details of sale list. On the said facts only the benefit of tax paid sale has been disbelieved. Record further reveals that the cash memo, which has been produced by the revisionist has not been disbelieved at any stage nor any finding has been recorded by any of the authorities that the said cash memo is forged and fictitious or the same is not of the selling dealers, hence, there is no reason to believe. This Court in the case of M/s Royal Trading Co., Saharanpur vs. Trade Tax Officer, Saharanpur (2000 U.P.T.C. 642) has held that for initiating reassessment proceedings there must be reasons to believe and the reassessment cannot be initiated on the whims and fancies of the taxing authority. Paragraph nos. 7 and 8 of the said judgment is quoted below: 7. therefore, action under section 21 of the Act cannot be taken on the whims of the Assessing Officer by restoring to conjecture of imagination. He has to have before him the facts which are germane to the issue and on the basis of which a rational man can have rason to believe that the whole or any part of the turnover has escaped assessment or has been under assessed. In Income Tax Officer vs. Mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itiation of proceedings under this section If however, the grounds are relevant and have a nexus with the formation of belief regarding escaped assessment, the Assessing Authority would be clothed with jurisdiction to take action under this section. 8. In the face of the law as explained in the above rulings the contention of the learned Standing Counsel that action could be initiated under Section 21 merely if the Assessing Officer though that the turnover had escaped assessment is not tenable and is against the patent provision of law which has used the word 'reason to believe' only to protect the tax payer from arbitrary and illegal action of the Assessing Officer. This view is also not supported by the various rulings cited by Sri R.D.Gupta in support of his contention that any reason is good enough for initiating action under section 21. He placed reliance on Kalpana Kala Kendra vs. Sales Tax Officer 1989 U.P.T.C. 597 ( Paragraph 19) in which this Court concluded we are fully satisfied that there is material before the respondent- Assessing Authority, which would furnish him grounds for entertaining a reasonable belief contemplated under section 21 of the act. R ..... X X X X Extracts X X X X X X X X Extracts X X X X
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