@JUDGMENTTAG-ORDER
M.M. Sundresh, J.@mdashThe petitioner herein has filed the present writ petition seeking the relief to call for the records of the second respondent made in S.T.A. No. 41 of 1998 dated March 15, 1999 and to quash the same.
2. The brief facts of the case in a nutshell are as follows :
The first respondent in the writ petition is a dealer in stainless steel utensils and an assessee under the Act. For the assessment year 1992-93, the first respondent was assessed by the Commercial Tax Officer on a total and taxable turnover of Rs. 1,06,17,514 and nil, respectively. Thereafter based upon the inspection made by the enforcement wing, the Commercial Tax Officer revised the assessment and refixed the total and taxable turnover of the assessee for a sum of Rs. 4,50,74,466 and Rs. 3,43,96,952, respectively. The entire taxable turnover was assessed to tax at eight per cent and penalty of Rs. 41,27,634 was levied. Challenging the order of the revision made by the Commercial Tax Officer, the assessee preferred an appeal before the Appellate Assistant Commissioner.
During the pendency of the appeal, the first respondent has filed the documents such as advance licence, letter given by the SAIL, export invoices, bill of lading, certificate issued by the foreign sellers and clearing agents, sale invoices, lorry receipts and labour bills, etc. Based upon the above said documents and on a consideration of the materials available on record the Appellate Assistant Commissioner has allowed the appeal in C. S. T. No. 58 of 1998 on July 27, 1998 by exercising the power u/s 31 of the Tamil Nadu General Sales Tax Act, 1959. Challenging the said order, the Department filed appeal before the second respondent herein. The second respondent in turn in and by its order dated March 15, 1999 in S. T. A. No. 41 of 1998 dismissed the appeal and hence challenging the abovesaid order, the present writ petition has been filed.
3. The learned Special Government Pleader (Tax) submitted that the order passed by the second respondent confirming the order of the Appellate Assistant Commissioner is per se illegal inasmuch as the documents relied upon by the first respondent ought not to have been taken into consideration by the Appellate Assistant Commissioner as well as the second respondent. According to the learned Special Government Pleader, a reading of Section 39B of the TNGST Act, 1959 would show that the Appellate Assistant Commissioner shall not, for the first time, receive in evidence on behalf of any dealer in any appeal, any documents, unless for the reasons to be recorded in writing, he considers that such documents is genuine and the failure to produce the same before the assessing authority was for the reasons beyond the control of the dealer and therefore in the absence of any such finding as required under Sections 31 and 39B of the Act, the second respondent ought to have allowed the appeal filed by the Department by holding that the reception of the documents filed by the Appellate Assistant Commissioner during the pendency of the appeal without recording a finding as required by the statutory provisions is not proper. The learned Special Government Pleader submitted that in view of the specific provisions as contained u/s 39B of the Act, the order impugned in the writ petition will have to be set aside.
4. The learned Special Government Pleader also submitted that if the documents filed by the first respondent are eschewed then there is no materials for the second respondent to come to the decision as found in the impugned order. Therefore it is submitted by the learned Special Government Pleader that the proceedings of the second respondent will have to be set aside. In other words by avoiding the additional documents filed by the first respondent and with the available materials on record, the appeal filed by the Department before the second respondent will have to be allowed.
5. Per contra, the learned Counsel for the first respondent submitted that the documents have been filed during the pendency of the first appeal by the first respondent and at that point of time there was no objection by the petitioner. It is only before the second respondent such a plea was raised. Even before the second respondent the very same documents have been filed. It cannot be said that the second respondent does not have the power to peruse the documents for the purpose of proper adjudication. Moreover inasmuch as the said documents have been found to be genuine and considered by the second respondent the petitioner cannot seek to set aside the order impugned only on the ground that the second respondent ought not to have considered the documents filed during the pendency of the first appeal. Further a reading of the impugned order would show that the first respondent has considered the entire facts involved in the case and gave a factual finding that the first respondent was maintaining to complete day-to-day stock account and there was no attribution of stock discrepancy or irregularity in the account. Therefore the learned Counsel prays for the dismissal of the writ petition.
6. The question to be considered in the present writ petition is as to whether the impugned order passed by the second respondent is liable to be set aside on the ground that the second respondent has considered the documents which ought not to have been taken into consideration in law or not. In order to appreciate the issue involved in the writ petition, the provisions contained in Section 39B will have to be looked into. Section 39B of the Tamil Nadu General Sales Tax Act, 1959 is extracted hereunder :
39B. Production of accounts.-(1) Every dealer liable to pay tax under this Act, shall make available to the assessing authority any account, register, record or other documents relating to the day to day transaction of his business.
(2) The Appellate Assistant Commissioner or the Appellate Deputy Commissioner shall not for the first time, receive in evidence on behalf of any dealer in any appeal, such account, register, record or document as is mentioned in Sub-section (1), unless for reasons to be recorded in writing, he considers that such account, registers, record or document is genuine and that the failure to produce the same before the assessing authority was for reasons beyond the control of the dealer.
(3) Except as provided in Sub-section (2) no appellate authority or revising or reviewing authority shall, for the first time, receive in evidence on behalf of the dealer any such account, register, record or document as is mentioned in Sub-section (1).
7. A reading of the abovesaid provision would show that Clause (1) of the said section would make it clear that every dealer is to make available to the assessing authority any account, register, record or other document relating to the "day-to-day transaction" of his business. Similarly of a reading of Clause (2) would make it clear that the Appellate Assistant Commissioner shall not receive the said evidence for the first time in the appeal unless for the reason to be recorded in writing to the effect that the said documents are genuine and the failure to produce the same before the assessing authority was for the reasons beyond the control of the dealer. The said embargo appears to have been incorporated only in order to see that the assessee should not be allowed to recast his accounts by plugging the holes pointed out in the assessment order. In the present case on hand what was produced before the Appellate Assistant Commissioner were the documents relating to the transactions between the dealer and the third parties. It is not the case of the Department that the said documents filed by the first respondent are pertaining to the day-to-day transaction of the first respondent and they are not genuine. If that is the position then the provision of Section 39B of the TNGST Act, 1959 in our considered opinion do not apply to the present case on hand. Therefore, the contention of the learned Special Government Pleader that the admission of the documents by the Appellate Assistant Commissioner is contrary to Section 39B cannot be countenanced.
8. Moreover even assuming that Section 39B is applicable to the present case on hand a reading of the said section would clearly show that there is no total prohibition for admitting the documents but the conditions specified therein will have to be specified. The Department herein has not made any objection when the documents were filed by the first respondent before the Appellate Assistant Commissioner. Therefore, we are of the opinion that having not objected to the said filing of the documents it is not open to the petitioner to hereof contend that the said documents ought not to have been admitted.
9. The contention of the learned Special Government Pleader cannot be accepted for yet another reason since under the Tamil Nadu Sales Tax Appellate Tribunal Regulations, 1959 power is given to the second respondent to permit a party to produce fresh evidence. A reading of the said provision would show that the second respondent may require any document to be produced for the purpose of enabling the second respondent to pass orders. In the present case on hand as observed earlier the Department has not raised any objection before the Appellate Assistant Commissioner. The order passed by the Appellate Assistant Commissioner was challenged by the Department before the second respondent. Even before the second respondent the very same documents have been filed. The second respondent while contesting the correctness or otherwise of the order passed by the Appellate Assistant Commissioner has considered the documents filed by the first respondent and confirmed the order of the first appellate authority. Therefore the second respondent has exercised the power under Regulation 12 and passed the order in favour of the second respondent. Hence we are of the considered view that in view of the availability of the power under Regulation 12 of the Tamil Nadu Sales Tax Appellate Tribunal Regulations, 1959 the contention of the learned Special Government Pleader is liable to be rejected.
10. In the judgment reported in Deputy Commissioner (C.T.), Coimbatore Division, Coimbatore-2 v. New Ajantha Wines [1979] 44 STC 327, the honourable Division Bench of this Court has observed as follows (at page 328) :
Notwithstanding the fact that there is no intendment in taxation nor any presumption, yet even tax laws are governed by the well-known doctrine that justice should not only be done, but should also seem to have been done. In the instant case, the contention of the assessee throughout was that, when he took over the assets of Manohara Wines, a turnover to the tune of Rs. 8,275.11 had already suffered tax, in the sense that his transferors had paid the tax, and that, therefore, the sales effected by him could only be second sales and should be dealt with as such. This was his specific case before the assessing authority and the Appellate Assistant Commissioner. We have already referred to the fact that entries and extracts from the books of account of Manohara Wines were with Appellate Assistant Commissioner, but, for reasons not known nor clear, he did not take the trouble of finding out whether the contention of the assessee was true or not : but, in a blanket order passed by him he was of the view that there was no evidence to substantiate the dichotomy claimed by the assessee that he was entitled to exemption as prayed for. Finding that, as the only way of proving his case, which was always consistent, was to enlighten his contention, the assessee sought the help of the suppliers of the stock to Manohara Wines, viz., Ajantha Wines, and produced the bill of Manohara Wines to further establish his case that the disputed turnover had already suffered tax in the first instance. The Tribunal thought that, in the interests of justice, an opportunity should be given to the assessee to prove/establish that his contention is corroborated by the evidence, which was no doubt sought to be placed before the Tribunal for elucidation. What is relied upon, in a wooden fashion, by the learned Additional Government Pleader is that Sub-section (2) of Section 39B can only apply to events and proceedings which take place before the Appellate Assistant Commissioner and that it should not be read as part of or intended to be part of Sub-section (3) of Section 39B. It is here that we said that the argument is wooden. If the Legislature has given a privilege to an assessee as also a right to the assessing officer to reciprocally establish as between themselves the correctness of the contention and the decision which they have to make respectively in a matter relating to taxation, then it will be anomalous to hold that, notwithstanding such a privilege given to the assessee and equally the right given to the assessing authority, including the highest one under the Act, such as the Tribunal, the Tribunal is precluded from looking into such evidence produced by the assessee in order to find out whether it is genuine and whether such record or document would substantiate the case already put forward by the assessee. We do not think that in taxing laws the intention of the Legislature is to give a privilege to an assessee only before one particular assessing authority and deny that privilege before another authority who is empowered to correct that previous authority in case of an error in judgment. It would lead not only to an anomalous, but also to a denial of justice. As we have already observed, though in tax law there is no intendment, yet, as the principle of justice being done should be known and made known is applicable to all cases and in all circumstances, we are of the view that the admission of evidence in this case in the sense of substantiation of the contention already urged by the assessee, for which the necessary documents were already in the court, would not amount to admission of evidence for the first time before the Tribunal as is sought to be contended by the learned Additional Government Pleader. We are therefore of the view that, in the peculiar circumstances, the Appellate Tribunal can have and, in our view, has, the requisite power to find out whether any register, record, account book or document produced before it is genuine so as to find out whether the assessee is entitled to certain concession or benefit under the Act. It is pertinent to observe at this stage that the assessee had already produced the relevant bills under which Manohara Wines had purchased the disputed stock from Ajantha Wines, and the learned Additional State Representative, after verification of such records, was satisfied that in respect of the disputed stock sales tax had already been collected. This factor cannot lightly be ignored and the assessee directed to suffer tax when he is legitimately not liable to submit to the levy. In this view, we accept the order of the Tribunal and dismiss the tax case.
11. The honourable Division Bench of this Court has observed that it cannot be said that the Tribunal is precluded from looking into evidence produced by the assessee in order to find out whether it is genuine and whether such record or document would substantiate the case already put forward by the assessee. The law lay down by the honourable Division Bench is applicable to the present case on hand, in which, the second respondent found it proper to consider the evidence produced by the first respondent while coming to the conclusion.
12. Hence on consideration of the facts involved in the present case and also on the legal position, we are of the opinion that the writ petition is liable to be dismissed and accordingly the same is dismissed. No costs.
