The Hyderabad bench of the Income Tax Appellate Tribunal (ITAT) held that the Demand Collection Balance (DCB) reports are relevant evidence in respect of the non-existence of demand on proper payment of Central Sales Tax (CST) and Value Added Tax (VAT).
The assessee is a partnership firm, engaged in the business of milling and trading of paddy, rice, and broken rice at Nizamabad. While scrutinizing the return of income filed by the assessee the Assessing Officer found that the assessee claimed the CST and VAT payments in the profit and loss account.
When called upon to produce the original and the self-certified copies of the challans relating to the payment of CST and VAT, the assessee failed to produce the same. Therefore, the Assessing Officer added a sum of Rs. 11,25,426/- and 74,97,596/- towards CST and VAT payments.
The Authorized Representative submitted that due to the absconding of the accountant, they are unable to produce any evidence other than the DCB report in respect of CST and VAT and to establish that there was no existing demand, which un-mistakably indicates that the amounts were properly paid.
The Departmental Representative submitted that in the absence of any evidence whatsoever, the authorities are justified in denying the claim of the assessee. He submits that the new plea taken by the assessee that the payments towards CST and VAT could be inferred through DCB reports and the nonexistence of any demand in force, needs factual verification and per se, the assessee is not entitled to any relief.
The Two-bench member comprising of Rama Kanta Panda (Vice-president) and K. Narasimha Chary (Judicial member) directed the Assessing Officer to take into consideration the DCB reports and to consider the same in the light of the submissions of the assessee that the non-existence of any demand for the relevant period towards CST and VAT amounts proper payment.
Thus, the appeal of the assessee was allowed for statistical purposes.
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