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2010 DIGILAW 1784 (ALL)

SWADESHI UDYOG v. TRADE TAX OFFICER, KANPUR.

2010-05-26

BHARATI SAPRU, RAJESH KUMAR

body2010
JUDGMENT By means of this present writ petition, the petitioner is challenging the initiation of proceedings under section 21 for the assessment year 1995-96. The petitioner was carrying on the business of purchases and sales of mustard oil. During the year under consideration, the petitioner claimed to have purchased mustard oil within the State of U.P. for Rs. 1,12,63,062. Mustard oil was liable to tax at the point of manufacturer or importer. The petitioner claimed exemption on the sale of the mustard oil, on the ground that the purchases were made within the State of U.P. and the petitioner was neither a manufacturer nor an importer. The assessing authority has passed original assessment order under rule 41(8) on February 5, 1998 and on the examination of the books of account and the list of purchases, granted the exemption on the sales of mustard oil. The proceedings under section 21 have been initiated on the ground that in the assessment year 1997-98 it was found that certain purchases were not verifiable and, therefore, inference has been drawn that the purchases of mustard oil for the year under consideration were also not verifiable and accordingly the notice under section 21 was issued. The learned counsel for the petitioner submitted that there is no material for the year under consideration for coming to the conclusion that the purchases were not verifiable and, therefore, in the absence of any material, initiation of proceedings was not justified. We have called upon Shri U. K. Pandey, learned standing counsel, to disclose the material for the year under consideration on the basis of which the belief has been formed that the purchases were not verifiable. No such material has been disclosed. He only submitted that since in the assessment year 1997-98, some of the purchases were found non-verifiable, therefore, the inference has been drawn for the year under consideration also. Having heard learned counsel for the parties. We have gone through the record. We are of the view that the initiation of proceedings under section 21 is based on no material. Each year is an independent year for the purpose of assessment. Having heard learned counsel for the parties. We have gone through the record. We are of the view that the initiation of proceedings under section 21 is based on no material. Each year is an independent year for the purpose of assessment. Unless there is a material for the year under consideration to show that the purchases were non-verifiable, the inference that the purchases may also not be verifiable for the year under consideration on the basis of the material for the assessment year 1997-98 is wholly unjustified. In the facts and circumstances, we are of the view that the initiation of proceedings is based on no material and the basis on which the belief is alleged to have been formed is wholly unfounded. In the result, the writ petition is allowed. The proceedings under section 21 of the assessment year 1995-96 are hereby quashed. No order as to cost.