SIV INDUSTRIES LTD Vs. STATE OF KERALA
HIGH COURT OF KERALA
Siv Industries Ltd
STATE OF KERALA
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(1.) THE matter arises under the K.G.S.T.Act,1963,for short,'the Act ' ;.The assessee is the revision petitioner.State is the respondent.The assessment year concerned is 1997 -98.For this assessment.year,the assessee filed a return disclosing a total and taxable turnover of Rs.1,04,09,038/ - and Rs.1,01,05,862/ - respectively.The assessing authority proposed to? reject the books of accounts and the return filed by the assessee on two grounds.The first ground was that though the assessee had shown the closing stock of 208.73 MT.of Sulpher valued at Rs.5,08,310.43 as stock transferred to the head office supported by F -form since the assessee has not produced supporting documents to establish the stock transfer,the claim cannot be allowed.The second ground was that the assessee at the time of verification of the books of accounts had not made available the departmental delivery note bearing serial Nos.RAA 517351 to 517375 issued from that office and that on verification of the stock register of departmental delivery note,invoices etc .,it is seen that the assessee has used delivery notes upto serial No.517375 and that the assessee had not made satisfactory explanation regarding missing of the delivery notes from serial No.517376 to 517400.The assessee had filed objection stating that the closing stock worth Rs.5,08,310.43 was transferred to the head office which is supported by advise note issued by South India Corporation,Willingdon Island.Regarding the missing of the delivery notes,it is stated that on coming to know about the missing of the delivery notes,the said fact was notified in the Malayala Manorama Daily dated 19.7.2000 The assessing authority did not accept the explanations offered by the assessee.The books of accounts were rejected.Apart from including a sum of Rs.5,08,310.45,the assessing authority had also included a sum of Rs.7,62,972/ - on account of the missing of the delivery notes based on the total value of the 25 delivery notes admittedly used by the assessee.This was confirmed in appeal by the two appellate authorities.
(2.) THE learned counsel appearing for the assessee submitted that the assessing authority has not found any defects in the accounts maintained by the assessee and that practically,the assessing authority had accepted the books of the assessee;however the assessing authority had included the value of the closing stock in the turnover rejecting the claim of the assessee that the said goods were stock transferred to the head office as also the estimated value of goods alleged to have been transferred by using the missing delivery notes.The counsel submits that though it is true that under the provisions of R.32(18)and R.33A of the K.G.S.T.Rules,the assessee is bound to keep the delivery notes in safe custody and in cases where delivery note is missing,the assessee is bound to intimate the said fact to the assessing authority immediately.In the instant case,as soon as the missing of the delivery notes came to the notice of the assessee,the assessee had published the said fact in the Malayala Manorama Daily.The counsel also submits that in the absence of material to show that the assessee had indulged in any unaccounted purchase or sale of goods which in the present case is absent,there is no justification in assuming that the assessee had used the missing delivery notes for use in unaccounted purchase and sale of goods.The counsel submitted that it is at the most a case for initiating penal proceedings for contravention of the provisions of the Act and the Rules.
Learned Government.Pleader appearing for the respondent on the other hand submits that though the assessee had shown the entire closing stock of goods that are despatched to the head office by way of stock transfer supported by F form the assessee did not produce any supporting documents to establish the particulars in the F form declaration.The Government Pleader also submitted that the entire case regarding the missing of the delivery notes put forward in the reply to the preassessment notice is the result of an after thought and that all the three authorities are justified in assuming that the assessee might have used the missing delivery notes for unaccounted purchase and sale of goods.The Government Pleader further submitted that when all the three authorities have concurrently found as a fact that the assessee had made use of the missing delivery notes for unaccounted purchase and sale of goods,this Court in exercise of the revisional jurisdiction under S.41 of the Act will not interfere with such finding of fact.The Government Pleader in support of the said contention has relied on the decision of this Court in Azad Group Hotels v.State of Kerala 1994(93)STC 377 ),The Government Pleader further relied on the decisions of this Court in Associated Rubber Co.v.State of Kerala(1993(91)STC 433)and in A.Abdul Rasheed v.State of Kerala 1997(105)STC 357)
(3.) WE have considered the rival submissions.As already noted,the grounds on which the accounts and returns submitted by the assessee were rejected are that the alleged stock transfer of the closing stock of Rs.5,08,310.43 cannot be accepted and that 25 delivery notes issued to the assessee were missing.Though the assessee had contended that the stock transfer of the closing stock was supported by F -form and the adviser note issued by the South India Corporation Limited,Wi11ingdon Island,the assessing authority did not accept the same stating that the claim of stock transfer has not been established.The assessing authority has also noted the discrepancies in the quantity shown in F -form and in the two delivery advices issued by South India Corporation.In short,according to the assessing authority,the case of stock transfer or the closing stock cannot be accepted.This finding of the assessing authority was upheld both by the appellate authority and by the Tribunal.Having regard to the circumstances stated by all the three authorities and the findings entered by them,we do not think that there is any case for interference with the findings of fact arrived at by all the three authorities on the said question.;
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