Jainendra Kumar Ranka, J. - (1.) INSTANT revision petition has been filed by the petitioner against the order dated July 29, 1998 passed by the Rajasthan Tax Board, Ajmer (in short, "the Board") in Appeal No. 878 of 1993 whereby the Tax Board affirmed the order passed by the Deputy Commissioner (Appeals) II, Commercial Taxes Department, Jaipur, (in short, "the DC(A)). The DC(A) also upheld the order passed by the CIO (Frying Squad), HQ, Jaipur, whereby the penalty of Rs. 1,10,135 was imposed against the petitioner. The revision petition was admitted on November 5, 1998 on the following questions of law: (1) Whether the penalty under section 22A(7) could be imposed upon the goods in transit, which is STP in the hands of the consignor? (2) Whether the petitioner could be bound to produce the books of accounts of the third party? (3) Whether the petitioner have a right to know about the progress of the enquiry conducted by the authorities regarding the transactions' genuineness?
(2.) THE brief facts emerging on the face of the record of the case are that on November 23, 1991 a tanker bearing No. DL -IG.6906 was checked by the officer of the Flying Squad, Jaipur, which was containing oil. On enquiry, by the officer from the driver of the vehicle, the driver stated that the oil was filled in the tanker from one factory situated in Matsya Industrial Area, Alwar, while the bill of purchase belongs to M/s. Mangal Chand Lachhi -ram, with address of Kedal Ganj Alwar, who is a trader. The purchase bill showed weight of the goods as 9 tonnes, i.e., 9000 kgs. while the weighment parchi issued by "Jain Dharamkata" showed the weight of the goods as 10,960kgs., which created doubt in the mind of the officer of the Department. Therefore, the oil was seized. After seizure of the goods, on further checking again the driver confirmed his earlier statement and stated that the oil was filled in the tanker from M/s. Agarwal Oil and General Mills, MIA, Alwar. On examination of the bills, from M/s. Mangal Chand Lachhi -ram, i.e., the petitioner one partner Shri Shrawan Kumar appeared and informed that the goods were purchased from M/s. Yogendra Trading Co., Kedal Ganj, Alwar by Bill No. 204 dated November 22, 1991. The petitioner was asked to produce account books of M/s. Yogendra Trading Co., to confirm and justify the said purchase as also other documentary evidence to substantiate his claim about purchase from Yogendra Trading Co. and not from M/s. Agarwal Oil and General Mills as it was prima facie proved by the Department that the goods were purchased from M/s. Agarwal Oil and General Mills and not from M/s. Yogendra Trading Company rather only a bill was placed of Yogendra Trading Company. Therefore, on the basis of wrong information and on producing false and fictitious documents, show -cause notice under section 22A(7) of the Sales Tax Act was issued. On further enquiry, it was found that the earlier name of Yogendra Trading Co. was M/s. Agarwal Oil Mills, 82, Azad Nagar, Daudpur but from February 13, 1991 the name and title of the firm was Yogendra Trading Co., Alwar. It was also noticed that the said firm filed return for one quarter for the year 1990 -91, with negligible turnover and though subsequent returns were filed but the turnover for the subsequent period was shown as nil and even for the year 1991 -92 no return was filed. The petitioner was confronted with the above facts by the respondent. It was desired by the respondent -Department to get the confirmation/other material to justify the claim of the petitioner that the goods (oil) in the tanker was purchased from Yogendra Trading Company and also to produce the records of Yogendra Trading Co. However, on the contrary, a certificate was submitted from M/s. Agarwal Oil and General Mills that the goods were not sold to the petitioner but neither confirmation nor affidavit was filed, what to talk of producing books of accounts of Yogendra Trading Company. Thus no satisfactory explanation was submitted by the petitioner.
(3.) CONSIDERING the above facts and circumstances of the case, it was held that the petitioner has failed to substantiate its claim that the goods in question was purchased from M/s. Yogendra Trading Company and not from M/s. Agarwal Oil and General Mills, rather some adjustment was made, knowingly and that it is a clear -cut case of evasion of tax. It has further been stated that when confronted with the aforesaid fact that the partner of the petitioner -firm has denied purchase of goods from M/s. Agarwal Oil and General Mills, MIA, Alwar and that it was purchased from Yogendra Trading Co., the driver of the tanker on the second occasion again stated that he is not aware of the fact but he was very categorical and stated that the oil was filled in the tanker from M/s. Agarwal Oil and General Mills, MIA Alwar. Accordingly, the respondent -Department held that the bills found in the possession of the driver were bogus and fictitious and accordingly imposed penalty under section 22A(7) amounting to Rs. 1,10,135.;