Maithli Sharan, J. - (1.) In this petition, the grievance raised is against the notice issued to the petitioner under Section 21 of the U.P. Trade Tax Act for the assessment year 1980-81. Section 21 of the U.P. Trade Tax Act permits reopening of the assessment already made, in case there is reason to believe that the whole or any part of the turnover of a dealer, for any assessment year or part thereof has escaped assessment to tax or has been under-assessed to tax or on the ground that the deductions or exemptions have been wrongly allowed. We have heard learned counsel for the petitioner and learned Standing Counsel.
(2.) The facts in brief are that the petitioner manufactures steel wires which are used as raw material by other manufacturers of certain notified items. The petitioner sells the manufactured steel wires to other dealers. In the present case certain sales were made to purchasers who held eligibility certificate granted to them under Section 4-B of the U.P. Trade Tax Act. Section 4-B of the U.P. Trade Tax Act provides special relief to certain manufacturers. There may be total exemption from payment of tax or its payment on concessional rate. This concession is available to a dealer, who requires the goods for using it for the manufacture of any notified goods, etc.
(3.) The purchasing dealer who made purchases from the petitioner, as indicated above, held eligibility certificate issued to them under Section 4-B(2) of the U.P. Trade Tax Act. It appears that total exemption from payment of tax was granted. The procedure as prescribed for such transactions, is that the purchasing dealer, has to furnish form 3-Kha as prescribed under the Rules to the selling dealer. On such form being furnished either no sales tax is realised or it is realised on concessional rates by the seller from the purchasing dealer, consequently such turnover would not be taxable in so far as it relates to the turnover of the seller against form 3-Kha. Accordingly the petitioner was assessed taking into account the sales made by the petitioner against form 3-B(Kha) furnished by purchasing dealer. A perusal of the assessment order passed by the assessing authority indicates that the petitioner had made sales against form 3-Kha furnished to it by the purchasing dealers to the extent of turnover of Rs. 64,47,374.80. This amount of turnover has been indicated against form 3-Kha and it has accordingly been found exempted from payment of sales tax. A copy of the assessment order has been filed as annexure 1 to the writ petition.;