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Allahabad High Court · body

2004 DIGILAW 2484 (ALL)

Metlon India v. Commissioner, Trade Tax

2004-12-10

RAJES KUMAR

body2004
RAJES KUMAR, J. ( 1 ) THIS four revisions under Section 11 of U. P. Trade Tax Act (hereinafter referred to as "act")are directed against the order of Tribunal dated 29. 10. 2004 relating to the assessment year 2001-02 and 2002-03 both under the U. P. Trade Tax Act and Central Sales Tax Act. ( 2 ) APPLICANT was involved in the manufacturing of metalised plastic films. Unit was holding an eligibility certificate under Section 4-A of the Act for the period of 20. 02. 1995 to 19. 02. 2003 upto monetary limited of Rs. 66,56,239/ -. Assessing authority rejected the books of account and enhanced the turn over. First appeals filed by the applicant were rejected. Applicant filed second appeals before Tribunal, which were also rejected. ( 3 ) HEARD learned counsel for the parties. ( 4 ) TRIBUNAL has rejected the books of account on the ground that during the assessment year 2000-01 as against the electricity consumption at 513596, units production was shown at 402 mt while in the assessment year 2001-02 as against the electricity consumption at 638164, units production was shown at 268 MT and for the assessment year 2002-03 as against the electricity consumption at 668736, units production was shown at 314 MT. ( 5 ) APPLICANT explained that the electricity consumption in the manufacturing of 23 Micron and 12 Micron are different. It was explained that the applicant was manufacturing the goods of 12 micron, which requires more electric consumption as compared to the goods of 23 micron as in one kg. , the length of 12 micron is more than the length of 23 micron. The weight of 23 micron is 33 gm. Per sq. meter, whereas the weight of 12 micron is almost half i. e. 17 gm. Per sq. meter and, therefore, to manufacture one kg. goods of 12 micron the usage of machinery is almost double than the use of machinery for manufacture of 1 kg. of 23 micron is almost double than the use of machinery for manufacture of 1 Kg. of 23 Micron. It was further explained that chilling tower was in operation even during the closure of the manufacturing which resulted continues consumption of power, though manufacturing did not take place and electricity was also consumed in residential area. of 23 micron is almost double than the use of machinery for manufacture of 1 Kg. of 23 Micron. It was further explained that chilling tower was in operation even during the closure of the manufacturing which resulted continues consumption of power, though manufacturing did not take place and electricity was also consumed in residential area. These explanations have not been accepted by the Tribunal on the ground that it can not be believed that during the closure of the production, chilling plant kept in operation. Tribunal further held that though the less production was shown but the claim of labour expenses etc. have not been shown less and the position was same as it was in the earlier years. Tribunal observed that no prudence business may keep in operation the chilling plant without production. Tribunal further held that the separate account for the job work had not been produced and it had not been shown that which production relates to the job work. Tribunal accordingly, sustained the estimate of turn over on the basis of the higher consumption of electricity. ( 6 ) LEARNED counsel for the applicant submitted that higher consumption of electricity is no ground for the rejection of the books of account and in support of which, reliance is placed on the decision reported in 1993 UPTC 46, Durean Steels Limited, Dehraduv v. CST. , CST v. Shivare P. Ltd. , 1992 UPTC, 94. ( 7 ) LEARNED Standing Counsel submitted that the applicant had not maintained the proper books of account. He submitted that it was found that the separate account for the job work and the owned manufactured goods have not been maintained. At the time of survey dated 23. 07. 2003 documents relating to the power consumption were found for the year under consideration. RG-1 register was found written upto 09. 07. 2003 and as per RG-1 register on 09. 07. 2003 stock was 1648. 10 Kg. , which could not be verified with the stock found at the time of survey. ( 8 ) I have perused the order of the Tribunal and the authorities below. ( 9 ) I do not find any force in the argument of learned counsel for the applicant. 07. 2003 stock was 1648. 10 Kg. , which could not be verified with the stock found at the time of survey. ( 8 ) I have perused the order of the Tribunal and the authorities below. ( 9 ) I do not find any force in the argument of learned counsel for the applicant. It is true that mere on the basis of the higher electricity consumption, books of account can not be rejected but the said principal is not applicable to the present case. Applicant unit is a electricity operated unit. It is wholly unbelievable that on the same situation and circumstances on the higher consumption of electricity production was less in comparison to the earlier years. Details of three years electricity consumption and the production are reproduced as below; assessment Year Production electricity Consumed2000-01 402 MT 5,13,5962001-02 268 MT 6,38,1642002-03 314 MT 6,68,736 ( 10 ) IT is wholly unbelievable that during the closure of the manufacturing, chilling plant was kept in operation. Deputy Commissioner (Appeals) found that chilling plant is not required to be kept in operation in the event of non-production. Deputy Commissioner (Appeals) also observed that inspite of the several opportunity being given for verification of production from production register, labour attendance register and the payment made to the labour but same could not be done and the closure of the manufacturing also could not be got verified from the labour attendance register and labour payment register. Applicant had also not maintained separate account for the own manufacturing and job work and it could not informed that which raw material have been used in the manufacturing of job work and which goods have been used on own manufacturing. Excessive power consumption clearly establishes the intent to suppress the production and the turn over. No proper reason was given for the higher consumption of the electricity. Comparing with the electricity consumption and the production with the earlier years, it is clear that during the years under consideration, production has been suppressed and no proper and reasonable explanation has been given for less production during the years under consideration. Finding of the Tribunal about the non-maintenance of proper account and suppression of production and turn over are finding of facts. They are neither perverse nor based on no material. In the circumstances, no interference is called for. No other point has been argued. Finding of the Tribunal about the non-maintenance of proper account and suppression of production and turn over are finding of facts. They are neither perverse nor based on no material. In the circumstances, no interference is called for. No other point has been argued. ( 11 ) IN the result, all the four revisions fails and are accordingly, dismissed. . .