Judgment :- 1. The above Tax Case Revision is filed at the instance of the assessee as against the order of Sales Tax Appellate Tribunal dated 6.5.2002 passed in TA No.233 of 2000 in respect of assessment year 1993-94. The above Tax Case Revision was admitted on the following substantial questions of law:-"1. Whether the Appellate Tribunal was justified in confirming the levy of purchase tax under Section 7A of the Tamil Nadu General Sales Tax Act,1959 relating to the purchase of declared goods namely "iron scraps" from seller (M/s.Ragavendra Emterprises, Padi), on the basis of the cancellation of certificate of registration, (M/s.Ragavendra Enterprises, Padi) more so when the entire purchases were made prior to the date of cancellation of registration. 2. Whether the Appellate Tribunal was justified in ignoring the law that the "point of taxation" relating to "declared goods" falling under Section 14 of the Central Sales Tax Act, 1956 read with Section 4 of the Tamil Nadu General Sales Tax Act, 1959 cannot be shifted from the point of first sale at the hands of the seller to the point of purchase at the hands of the petitioner as per the law laid down by the Apex Court in 114 STC 1? 3. Whether the Appellate Tribunal was justified in ignoring the law that the certificate of registration cannot be cancelled with retrospective effect." 2. The assessee is manufacturer of M.S.Rounds. During check of accounts the Assessing Officer found that the claim on second sales of M.S. Scraps was allowable in favour of the assessee. However, the assessment was reopened to tax the turnover of Rs.38,28,086/- on the ground that the purchaser Raghavendra Enterprises, Avadi, was only a bill trader, whose registration was cancelled by the proceedings of the Deputy Commercial Tax Officer, Avadi Assessment Circle dated 19.11.1993. The assessee however pointed out that the said cancellation being only on 19.11.1993, the purchase made prior to 19.11.1993 for Rs.9,55,349.50 be allowed for exemption. On considering the above said submission, the Assessing Officer however rejected the claim by stating that merely because the order of cancellation was dated 19.11.1993, it would not mean that the purchases effected prior to that date would be allowed for exemption. Thus, the assessment was confirmed. 3. Aggrieved by the order of assessment, the assessee went on appeal before the Appellate Asssistant Commissioner. Thus, the assessment was confirmed. 3. Aggrieved by the order of assessment, the assessee went on appeal before the Appellate Asssistant Commissioner. He once again rejected the assessee's claim and confirmed the assessment made by the Assessing Officer under Section 7-A of the Tamil Nadu General Sales Tax Act. The first Appellate Authority pointed out that the assessee had not proved that the sellers had really effected transactions of sale of goods. In the absence of proof that the said Raghavendra Enterprises had carried on business by handling the goods in question, the transactions could not be accepted. It was further pointed out that the said Raghavendra Enterprises had only issued sale bills and had acted as bill trader. Consequently, the assessment under Section 7A of the Tamil Nadu General Sales Tax Act was confirmed. In respect of levy of penalty too, the first Appellate Authority confirmed the order of Assessing Officer. Aggrieved against the same, the assessee went on appeal before the Tamil Nadu Sales Tax Appellate Tribunal. 4. A reading of the order of the Tribunal would reveal that the Tribunal discussed the issue in detail in paragraph 13 to reject the claim of the assessee. It pointed out that the place of business of Raghavendra Enterprises was inspected by the Deputy Commercial Tax Officer, Avadi on 8.9.1993. The Registration Certificate revealed that it was issued both for the main place of business and branch office. Thus, the inspection of the branch office revealed that it was under occupation of one Beer Mohamed, a local resident, and his family members were not aware of one Palani, who happened to be the Proprietor of Raghavendra Enterprises. There was no stocks found. A notice was issued for cancellation. A notice was also affixed in the principal Office. Even then, it was found that he was not available. Hence, a registered letter was sent to Palani on 13.9.1993. Even though the same was served on 21.9.1993, there was no reply. Further it was pointed out that the dealer had not filed any returns. Taking note of the said fact, the registration certificate was cancelled by the Assessing Officer and the cancellation certificate was sent by registered post with acknowledgment due, which was also returned. Even though the same was served on 21.9.1993, there was no reply. Further it was pointed out that the dealer had not filed any returns. Taking note of the said fact, the registration certificate was cancelled by the Assessing Officer and the cancellation certificate was sent by registered post with acknowledgment due, which was also returned. Thus, based on the materials, the Assessing Officer held that the assessee has not substantiated its contention that on the purchases made from Raghavendra Enterprises, the said dealer had, in fact, dealt with the goods. Referring to the contention of the assessee that the said Raghavendra Enterprises had acted as a broker in iron and steel and participated in the auction sales conducted by the Southern Railway, the Tribunal pointed out that the alleged Raghavendra Enterprises sale bill contained an entry that it was a second sale and if Raghavendra Enterprises had acted as a broker on behalf of some other dealers, the identity should be established. The contention of the assessee was Raghavendra Enterprises had arranged to send the goods from the stockyard of the Railways directly to the customers was also not substantiated. The supply of M.S. Scraps which had lost its identity in the re-rolling mills, should have suffered tax in the State of Tamilnadu, which was also not proved. Rejecting the contention of the assessee that the payments were made by way of cheque, and hence, the purchaser was a registered dealer, the Tribunal held that on the mere fact of payment by way of cheque by itself would not prove the case of the assessee that the said Raghavendra Enterprises had actually dealt with the goods. In the background of these facts, the Tribunal rejected the assessee's contention as to the genuineness of the purchase of goods from a registered dealer. Thus, applying the decision 28 STC 227 – M.K.KANDASWAMI v. STATE OF TAMIL NADU and36 STC 191 – STATE OF TAMIL NADU v. M.K.KANDASWAMI, the Tribunal held that unless the purchases had suffered tax, the question of excluding the operation of Section 7-A did not arise. Thus, the assessment was confirmed. However, the Tribunal cancelled the levy of penalty based on Section 16(2) of the Tamil Nadu General Sales Tax Act. Aggrieved by the same, present appeal by the assessee. 5. Thus, the assessment was confirmed. However, the Tribunal cancelled the levy of penalty based on Section 16(2) of the Tamil Nadu General Sales Tax Act. Aggrieved by the same, present appeal by the assessee. 5. Even though learned counsel for the assessee pointed out that the cancellation of registration was only on 19.11.1993 and hence, exemption could be allowed in respect of sales taken place prior to the date as taken from the registered dealer, we do not find any ground to accept this reasoning. When the said dealer has not proved the genuineness of the transactions, and there being no material to substantiate the contention of the assessee that the said Raghavendra Enterprises had in fact handled the goods, even for the period prior to the date of cancellation of registration, we do not find any ground to differ from the view taken by the Tribunal. 6. Consequently, the order of the Tribunal is sustained and the above Tax Case (Revision) is dismissed. No costs.