Laxmi Brick Field, Sarain Sahboj vs Commissioner of Trade Tax U.P.

Anil Kumar, J.—Heard Sri Pradeep Agarwal, learned Counsel for the revisionist and Sri Sanjay Sareen learned Counsel for the opposite party.

The factual matrix as submitted by Sri Pradeep Agarwal learned Counsel for the revisionist are that M/s Laxmi Brick Field, Sarain Sahboj, Fatehpur , Barqbanki (hereinafter referred to as ''revisionist'') is firm dealing with manufacturing and selling of brick at district Barabanki and the same is registered as dealer under the U.P. Trade Tax Act, 1948 (hereinafter referred to as ''Act''). On 11.5.1983 a survey was conducted on the brick field of the revisonist and on the basis of same assessment proceedings for the assessment year 1983-1984 had been started by issuing a show cause notice . In response to the same, the revisionist submitted his version/reply to the assessing authority . However, the assessing authority without any reasonable justification had rejected the version of the revisionist and passed Best Judgment Assessment order dated 31.12.1987.

It was further submitted by the learned Counsel for the revisionist that the best judgment assessment had been made merely on the basis of survey dated 11.5.1983 as at the time of survey books of account was not produced so on the turnover of Rs. 3,67,796/- by applying the selling rate of Rs. 275/- per thousand. The tax liability of Rs. 25,967/- was fixed for the assessment year 1983-1984. Order dated 31.12.1987 was challenged by the revisionist u/s 9 of the Act before the First Appellate Authority [Appeal No. 544 of 1988 (1983-1984)]. The department had also filed an appeal before the appellate authority against the said order i.e. Appeal No. 636 of 1990 (1982-1983). Both the appeals were heard together and by judgment and order dated 2.1.1992 the appellate authority had partly allowed both the appeals. So far in the appeal No. 544 of 1988 of the revisionist, the tax liability of Rs 1214/- was reduced.

Revisionist aggrieved by the order of first appellate authority, preferred the second appeal before the Tribunal [Second Appeal No. 209 of 1992 (1983-1984)] and the same was dismissed by the Tribunal by order dated 21.11.2001. Aggrieved by the said order, the present revision has been filed before this Court u/s 11 of the Act.

Learned Counsel for the revisionist submits that action on the part of the Tribunal thereby rejecting the second appeal of the revisionist and affirming the order passed by the authority below merely on the ground that non- availability of the account books at the time of survey does not construed a ground for rejecting the book versions as has been held in the case of S/s Kanpur Granite Stone Company, Jhansi v. Commissioner of Trade Tax 2005 UPTC 1075 and in the case of Amar Brick Field v. Commissioner of Sales Tax 1989 UPTC 288, so the order passed by the Tribunal ,is contrary to law and liable to be set aside.

Sri Sanjay Sareen, learned Counsel for the respondent submits that the Account Books submitted by the revisionist had been rightly rejected by the Tribunal . As such the controversy, which is involved in the present case comes within the ambit and scope of the estimation done by the authorities under the Trade Tax Act and once the controversy comes, within the ambit and is of the nature of estimation then the same cannot be a question of law. So the present revision filed by the revisionist is liable to be dismissed having no merit.

I have heard learned Counsel for the parties and perused the record.

Admittedly, in the present case, on the basis of survey which was done on 11.5.1983 the notices were issued and the proceedings for assessment years 1983-1984 had been started against the revisionist by the assessing authority. The assessing authority on the basis of the martial on record (reply of the revisionist) had rejected the book version of the assessee taking into consideration the following documentary evidence "Sri Rameshwar Prasad ki mratue 1986 me ho gai hai aur lekha pustake unhi ke pas thi, jo unhe prapth nahin ho saki hai . Unohone anuman se phukai 15.5.1983 tak karna banaya kintu iska koi sakshya prastut nahi kar sake" and thereafter the best judgment assessment was made on a turnover of Rs. 3,67,796/- by applying the selling rate of Rs. 275/- per thousand and the tax liability of Rs. 25,967/- was fixed and accordingly the assessment order dated 31.12.1983 was passed by the assessing authority.

Order dated 31.12.1987 was challenged by the revisionist before the appellate court and the appeal of the revisionist was party allowed by the appellate authority by order dated 2.12.1992 and the said order was again challenged by filing second appeal before the Tribunal and after considering the facts and the ground which were taken by the revisionist in his appeal, the Tribunal by order dated 21.11.2001 had held that the order passed by the assessing authority was perfectly valid as the firing period declared by the revisionist was totally incorrect and cannot be accepted and dismissed the second appeal as such there is no illegality in the order passed by the Tribunal.

So far as the judgment of S/s Kanpur Granite Stone Company Jhansi (Supra) which the learned Counsel for the revisionist has relied upon in the said judgment this Court has held as under:

Sri Alok Kumar, learned Counsel for the dealer-applicant submits that the Tribunal has committed illegality in maintaining the rejection of the books of account. Elaborating his argument it was submitted that although the books of account were not found at the time of survey but also no adverse material was found at the time of survey.

The books of account were produced during the course of assessment proceedings and no discrepancy could be pointed therein by any of the authorities below. It was submitted that non production of the books of account at the time of survey itself is not a ground for rejection of books of account .Reliance has been place upon the following three cases:

(1) Commissioner of Trade Tax v. Swarashtra Chemicals 1996 UPTC 178.

(2) R.P. Bhatia & Company v. Commissioner of Trade Tax 1988 UPTC 171 and

(3) Hemraj Udyog v. Commissioner of trade Tax, U.P. Lucknow 1998, UPTC 375

I have given careful consideration to the respective submission of the learned Counsel for the parties. The facts of the case are not much in dispute. The rejection of books of account has been upheld by the Tribunal mainly on the ground that the books of account could not be produced at the time of survey. In the case of R.P. Bhatia and Company (Supra) this Court has taken a view that non- production of cash book before the Surveying Officer is not irregular in nature that it should warrant rejection of books of account.

The revisionist cannot derive any benefit from the law as laid down by this Court in the case of S/s Kanpur Granite Stone Company Jhansi (Supra) as in the instant case the Best Judgment Assessment which was made by the assessing authority was not based on the fact that the books of account could not be produced at the time of survey but the same were produced during the course of the assessment proceedings after considering the same and the version/pleadings as submitted by the revisionist in support of his case, the assessing authority by order dated 31.12.1987 had passed the Best Judgment Assessment on turnover for assessment year 1983-1984 which was affirmed by the Tribunal. Accordingly the submission made in this regard by the learned Counsel for the revisionist having no force and is rejected.

Next submission made on behalf of the revisionist that whether the Tribunal was justified ignoring the law laid down by this Court in the case of M/s Amar Brick Field (supra) wherein it was held that the information regarding the closure of firing has to be considered by the Tribunal.

So far as the above said arguments advanced by the learned Counsel for the revisionist from the material on record in the present case it is clear that no documentary evidence had been produced by the revisionist in support of his claim regarding the firing period. Accordingly the above said submission made on behalf of the revisionist is misconceived and is rejected and the judgment cited in this regard are not applicable to the facts and circumstances of the present case.

Further, the controversy, which is involved in the present case comes under the category of estimation done by the authorities under the Trade Tax Act in the case of Biraj Kavar Galada, rep. by her L/R M.C. Galada and in the case of Zora Singh Vs. Commissioner of Income Tax, the Court has observed the estimation is a question of fact. The said view was further reiterated by this Court in T.T.R. No. 163 of 2007 CTT v. Chaudhary Brick Field Gonda decided on 30.7.2009 and T.T.R. No. 91 of 2005 Commissioner of Trade Tax, Lucknow v. Swastic Enterprise Jain Dharmshala Bhawan Charbagh, Lucknow decided on 28.07.2009 wherein it was held that estimation is a question of fact.

Moreover, while adjudicating and deciding the revision u/s 11 of the Trade Tax Act this Court can exercise the power of judicial review in order to interfere in the order passed by the tribunal when the question of law is involved and not the question of fact in this regard Hon''ble the Supreme Court in the case of Commissioner of Sales Tax, U.P. v. Kumaon Tractors and Motors, (2002) 9 SCC 379 has held as under:

It appears that the High Court ignored the provisions of Section 11 of the Trade Tax Act which confers limited jurisdiction to interfere with the order of the Tribunal only on the question of law, that too the said question of law is required to be precisely stated and formulated. Instead of deciding the question of law, the High Court simpliciter reappreciated the evidence and ignored the material documents maintained and produced by the assessee, that is, books of accounts, bills and Form ''C'' submitted by it. In this view of the matter, the impugned order cannot be sustained.

In the case of Naseer (Driver), Moradabad v. Commissioner of Trade Tax 2002 UPTC 1043 this Court has held as under:

The trade tax revision could also not be dealt with and decided as an appeal by this Court as an Appellate Authority in exercise of its jurisdiction u/s 11 of ''Act'' unless, the law point or the question of law if any involved or its shown that such finding of Tribunal is perverse based on no evidence, or no material on record or is otherwise arbitrary on the face of it which no court or authority could accept having regard to the prevailing facts and circumstances of a given case. The findings of learned Tribunal cannot be upset.

Again in the case of Nafees Ahmad, B.K.O., Basti v. Commissioner of Trade Tax 2002 UPTC 1085 this Court has held as under:

On considering the facts and circumstances of the case, the learned Tribunal by its order dated 31st August, 1995 has considered all the aspect of respondent in respect of brick production. Sales and firing period of production at the relevant period including the accounts of bricks and raw bricks etc. and has partly allowed the second appeal of opposite party/dealer. I find there is no illegality and impropriety in the impugned order of Tribunal . No question of law arises for consideration. This Court is not sitting as Appellate Authority. Therefore, the revisionist mentioned above are rejected.

In the case of Ganesh Ice Cream Factory v. Commissioner of Trade Tax 2002 UPTC 662, this Court has held as under:

The manufacturers were required to maintain stock register of raw material and finished goods and also to keep all the acccount books in his regular course of business . He has to keep the details of stock of raw materials purchased and details of manufactured material, however such required stock register has not been maintained so that it could be know as to how much material has been received and utilized and how much goods has been prepared and how much material left in the closing stock. For this reason, the applicant- revisionist has not been given any benefit. I have gone through the judgment dated 18th December, 1998 of learned Tribunal and I find no illegality or impropriety in the impugned order.

For the foregoing reasons as in the present case there is no question of law whatsoever is arises and only question of fact is involved from the order passed by the tribunal, which is under challenged so no interference is required in the tribunal''s order.

Accordingly, the present revision filed by the revisionist lacks merit and is dismissed.

No order as to cost.