Arun Tandon, J. - (1.) THIS trade tax revision filed by the assessee is directed against the order of the Tribunal dated December 8, 2005 passed in Second Appeal No. 221/2003 assessment year 1997 -98 in proceedings initiated under section 3B of the U.P. Trade Tax Act. Heard Sri Bharat Ji Agrawal learned senior advocate assisted by Sri R.R. Agarwal, advocate counsel for the assessee and Sri B.K. Pandey standing counsel on behalf of the Department.
(2.) THE facts in short giving rise to the present revision are as follows: The assessee before this court was granted exemption certificate under section 4B(2) of the Trade Tax Act. Tendu patta subject -matter of controversy is a raw material to be used by the assessee for manufacture of bidi. With reference to the exemption granted under section 4B(2) read with rule 25B(1) of the U.P. Trade Tax Rules, 1948, the assessee issued a declaration in form IIIB in the prescribed pro forma. On that basis he claimed concessional rate of tax on purchase of tendu patta, i.e., at 2.5 per cent. The assessing authority initiated proceedings under section 3B of the Trade Tax Act vide notice dated March 7, 2001, against the assessee on the ground that the declaration in form IIIB had been falsely issued inasmuch as the tendu patta covered by the said declaration had been used for manufacture of bidi at a unit situate outside the State of Uttar Pradesh for which no exemption certificate under section 4B has been granted in favour of the assessee.
(3.) THE assessee responded to the notice and in reply submitted that no wrong or false declaration was given in form IIIB. Tendu patta purchased was although used as raw material for manufacture of bidi at a unit outside Uttar Pradesh but the manufactured bidi was sold within the State of Uttar Pradesh. There has been no breach of the provision of section 4B(2) of the Act and therefore the proceedings under section 3B of the Act were bad.;