TMI Blog2008 (11) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... The said Topical Traders is a dealer in ceramic tiles. The business of M/s. Poseidon Food Company was to render services to various exporters as regards inspection and certification of quality of the items sought to be exported. The total turnover for the purpose of payment of sales tax was disclosed on the basis of the business carried out in the name of M/s. Tropical Traders. Whereas the taxable turnover was shown as 28,20,474.97, an addition of Rs.45,80,168.09 thereto was made by the Assessing Authority assessing a sum of Rs.3,58,87,960.97 by way of total turnover. The order of assessment proceeded on the basis that receipt shown as commission amounting to Rs.45,80,168.09 from M/s. Poseidon Food Company is not supported and proved by any documentary evidence. Appellant contended that the services so rendered is not a 'sale' and thus, the said order of assessment is wholly illegal and without jurisdiction. 4. An appeal was preferred thereagainst. Before the appellate authority the appellant produced income-tax returns, orders of assessments passed by the income-tax officer, orders placed by the exporters and the certificates granted by Marine Products Export Development Autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mount represents sales turn over, we have no doubt in our mind that the Assessing Officer is free to consider what exactly is the nature of receipt. If it is a net credit in the form of an income, it may even be possible for the officer to take it as income gross up the turn over (sic) as representing unaccounted sales and assess the same. In this case, the officer has taken the amount as unaccounted sales, which is probably the minimum damage that could be caused to the petitioner by virtue of Section 12 of the Act. In other words, we uphold this addition as a necessary consequence of the petitioner's failure to explain the receipt in this account." 9. A review application filed thereagainst has also been dismissed by an order dated 22nd March, 2007. 10. Mr. Bali, learned counsel appearing on behalf of the appellant urged: (i) The learned Tribunal as also the High Court committed a serious error in so far as they failed to take into consideration that the appellant having produced documents to show that two sister concerns of the appellant had been carrying out two different businesses, the income derived by one could not have been added to the sales turnover, although t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e rendered by a person attracts service tax, which is a different nature of tax, as has been held in Bharat Sanchar Nigam Ltd. and another v. Union of India and others, [(2006) 3 SCC 1], stating :- "84. As we have said Article 366(29-A) has no doubt served to extend the meaning of the word "sale" to the extent stated but no further. We cannot presume that the constitutional amendment was loosely drawn and must proceed on the basis that the parameters of "sale" were carefully defined. But having said that, it is sufficient for the purposes of this judgment to find, as we do, that a telephone service is nothing but a service. There is no sales element apart from the obvious one relating to the handset, if any. That and any other accessory supplied by the service provider in our opinion remain to be taxed under the State sales tax laws. We have given the reasons earlier why we have reached this conclusion." 15. It is true that in terms of Section 12 of the Act the burden is on the assessee. The said provision reads thus :- "12. Burden of proof. - (1) The burden of proving that any transaction of dealer is not liable to tax under this Act shall lie on such dealer. (2) T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ds produced by him by manufacture, agriculture, horticulture or otherwise; or (ii) trees which grow spontaneously and which are agreed to be severed before sale or under the contract of sale; (f) a person who whether in the course of business or not: (1) transfers any goods, including controlled goods whether in pursuance of a contract or not, for cash or deferred payment or other valuable consideration; (2) transfers property in goods (whether as goods or in some other form) involved in the execution of a works contract; (3) delivers any goods on hire-purchase or any system of payment by instalments; (4) transfers the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration; (5) supplies, by way of or as part of any service or in any other manner whatsoever, goods, being food or any other articles for human consumption or any drink (whether or not intoxicating), where such supply or service is for cash, deferred payment or other valuable consideration); Explanation.- (1) A society (including a cooperative society, club or firm or an association or body of persons, whether incorporate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the matter has been considered by this Court in Girdhari Lal Nannelal v. The Sales Tax Commissioner, M.P. [(1996) 3 SCC 701 ] wherein it was held :- "7. The approach which may be permissible for imposing liability for payment of income-tax in respect of the unexplained acquisition of money may not hold good in sales tax cases. For the purpose of income-tax it may in appropriate cases be permissible to treat unexplained acquisition of money by the assessee to be the assessee's income from undisclosed sources and assess him as such. As against that, for the purpose of levy of sales tax it would be necessary not only to show that the source of money has not been explained but also to show the existence of some material to indicate that the acquisition of money by the assessee has resulted from transactions liable to sales tax and not from other sources. Further, whereas in a case like the present a credit entry in respect of Rs. 10,000 stands in the name of the wife of the partner, no presumption arises that the said amount represents the income of the firm and not of the partner or his wife. The fact that neither the assessee-firm nor its partner or his wife adduced satisfact ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
