IMPORTANT POINT
The burden of proof under the TNGST Act rests with the assessee, and failure to establish claims leads to tax liability and penalties.

ORDER :

Anita Sumanth, J.

[PRAYER: Writ Petition filed under Article 226 of the Constitution of India praying to issue a Writ of Certiorari, to call for the records of the 1st respondent in CTA No.89/01 and quash the order dt. 21.12.2006 passed therein.]

This Writ Petition is filed challenging the order of the Tamil Nadu Sales Tax Appellate Tribunal (in short 'Tribunal') dated 21.12.2006. The following are the three issues that arise from the order of the Tribunal.

i. Whether the tax of Rs.5,80,905/- being the turnover assessed by the Assessing Authority under section 7A for non-production of sale bill and confirmed by the Appellate Assistant Commissioner is correct?

ii. Whether the turnover of Rs.8,68,432/- disallowed by the Assessing Authority on the export sales claimed by the dealer and confirmed by the Appellate Assistant Commissioner is correct?

iii. Whether the levy of penalty of Rs.85,133/- by the Assessing Authority and confirmed by the Appellate Assistant Commissioner is correct?

2. The impugned order confirms an assessment made for the period 1995-96 under provisions of the Tamil Nadu General Sales Tax Act, 1959 (in short 'TNGST Act'). The submissions of the petitioner and the respondent/Commercial Taxes Department on each of the issues are set out below in seriatim, with our findings and conclusions.

3. First Issue. The petitioner had claimed to have effected purchases of hosiery yarn for an amount of Rs.5,80,905/-. It had however been unable to produce purchase bills and, before the authorities, had averred that the sales had been from a local registered dealer by name Park-in-Mills, Tiruppur. In the absence of sales bills, there was a proposal by the assessing officer to reject the turnover and levy purchase tax in terms of Section 7A of the TNGST Act.

4. In appeal, the petitioner had filed an affidavit that Park-in-Mills had confirmed the factum of purchase. Since the affidavit had been filed for the first time before the Appellate Assistant Commissioner, the matter had been remanded to the Assessing Authority for verification.

5. Even at that stage, no satisfactory evidence had been produced by the petitioner to establish the purchases of yarn. However, one consistent request of the petitioner was that, despite its inability to establish the factum of purchases, since the registration number of Park-in-Mills had been supplied, due enquiry may be made by the assessing authority into the transactions of Park-in-Mills that would serve to establish the petitioner’s case.

6. In cases where the registration number of a selling/purchasing dealer is supplied, normally, the Assessing Authority is expected to look into the details in the context of the stand of the assessee, specifically to determine the veracity or otherwise of its stand and to ascertain whether the enquiry supports its claim.

7. However, in the present case, this appears to be an exercise in futility for the reason that Park-in-Mills is, evidently, not in possession of necessary materials that would support the stand of the assessee. Had such requisite particulars, such as purchase/sale bills/invoices been available with Park-in-Mills, there would have been no difficulty for the assessee to have procured them even at the first instance.

8. Hence and at this juncture, at a distance of nearly 20 years from date of impugned order, we are of the categoric view that there is nothing to be gained in seeking an enquiry of the nature that the petitioner seeks before us now.

9. The finding and conclusions of the Assessing Officer and the Appellate Assistant Commissioner, as confirmed by the Tribunal are detailed and have taken note of all relevant aspects of the matter. They have, concurrently, referred to the provisions of Section 10 of the Act that place the burden of proof upon an assessee for substantiation of its claims. In the interests of completion, we extract relevant portions of order of assessment dated 25.11.1999 and first appellate authority dated 11.09.2000, be