While entertaining the case, a Division Bench of Justice Dr B.R. Sarangi and Justice M.S. Raman of Orissa High Court observed that the date of the discovery of material is not relevant but the nature of material or evidence discovered.
The bench invalidated and overturned the tribunal’s contested order. Also, the case was returned to the Assessing Officer for reconsideration in accordance with the rules of natural justice and the law.
The petitioner is a proprietorship concern. As an unregistered dealer under the Odisha Sales Tax Act, 1947, it started its business from April 2004 in retail and semi-wholesale trade at Big Bazar, Berhampur and dealt in general merchandise, i.e., plastic goods, salt, rubber band, disposable glasses and plates etc.
The petitioner filed this revision under Section 24 of the Orissa Sales Tax Act in order to address the legal issues raised in the revision petition in its favour, reverse/set aside the second appellate court’s decision, and declare the proprietory is not responsible for paying the tax and penalties that have been assessed and demanded by the revenue.
The Vigilance Wing of the Sales Tax Department with police personnel visited the business premises of the petitioner and conducted meticulous checks of stocks lying in the shop and took inventory of the same.
The petitioner’s claim before the Sales Tax Tribunal was that the orders of assessment were made by the assessing officer without applying its mind and also without providing the petitioner a chance to be heard and behind the petitioner’s back.
The prime question mentioned by the petitioner in its revision petition is whether there can be a backward and forward projection of materials detected which are relevant to a particular assessment for the purpose of making assessment for some other year.
The bench observed that if the assessing officer wants to do so, some material has to be brought on record to justify just projection, which is absent in the present case. Thereby, the orders passed by the authorities cannot be sustained in the eye of law.
Furthermore, the court observed that the inspection conducted by the Vigilance officials in the premises and discovered that there was an electronic weighing machine and the petitioner was found to have obtained Weights and Measures License. But that ipso facto cannot be construed to be materials available to make assessments.
“The date when the material was discovered is not relevant. What is relevant is the nature of evidence or material discovered during the inspection is the most important thing” stated the High Court.
Also stated that in the absence of the same, the same cannot be utilized for making assessments for other years unless their relevance to any other period is established by the Assessing Officer.
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