LexM/S. ANDHRA AGENCIES versus STATE OF A.P.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A B (2008] 16 S. C.R. 264 M/S .. ANDHRA AGENCIES If. . STATE OF A.P. (Civil Appeal No. 6694 of '2008} · NOVEMBER 18, 2008 ...• ·. ~ . . ., ' ' ... [DR. ARIJIT PASAYAT AND DR. MUKUNDAKAM .,, , SHARMA, JJ.] Aildhra Prades.h General Sales Tax Act, 1957 - Credit C notes issued by the manufacturers-first sellers to the subsequent sellers/dealer - Inclusion of, in the taxable · · turnover of the -dealers - Held: Books of accounts not produced by assessees before authorities - Assessees directed to produce books of accounts before the authorities D for adjudication of issue in proper perspective. The assessees were dealers/distributors of liquor. The manufacturers-first sellers issued credit notes to the assessees. The question before this Court is whether . these credit notes were includible in the taxable turnover E of assessees. The stand of assessees before the authorities and High Court was that the first seller collected tax on total turnover representing the sale prices from respective F dealers and claimed reduction/rebate in their turnover representing credit notes and obtained reduction/rebate of tax from the department and hence such amount would not be part of taxable turnover in the hands of dealers who were subsequent sellers. The High Court G held that when the manufacturer returned a part of the sale consideration under the credit notes, the returned amount under the credit notes includes a part of the tax that was already collected since the tax collected was an inseparable part of the sale consideration. H 264 • r - - • ,._>-.-- ~ ANDHRA AGENCIES v. STATE OF A.P. 265 in the instant appeal, it was contended for the· A assessees that wholesaler had paid tax on the whole amount before adjustment of the credit notes and hence the revenue was not justified in levying further demand. Disposing of the appeal, the Court B . HELD: 1.1. The. basic issue can be better appreciated by way of an illustration. Hypothetically taking the sale price to b.e Rs.100/-, the tax to be paid by the selling dealets has to be on 100. He may collect 90, after giving discount. If the sale price of the intermediate seller is 110 C his liability to pay tax shall be on 10 i.e. 110-100. The department's stand that it should be 20 i.e. 110-90, would not be correct if the first seller had paid tax on 100. Therefore; it has to be verified as to what was the amount on which tax was paid on the illustrative figures given D above by the selling dealer. The stand of the assesses before the Tribunal and the High Court was that they were not given personal hearing and only on consideration of their objections, the orders were passed by the authorities. The Tribunal and the High Court held E that since objections were considered, there was no need for giving personal hearing .. Such conclusion is clearly unsustainable. It is conceded that the books of accounts were not produced before the authorities.·Additionally, there was no document produced to show that the selling F dealer had paid tax at 100 i.e. illustrative figure given above. Certain documents relating to the purchases by the assessees i.e. sale bills and memos of the selling dealers were produced· to show as to the amount on which the tax was paid by the selling dealers. These G apparently were not considered because of the fact that the books of account were not produced by the assessee. [Paras 5 and 6] [268-E-H; 269-A-C] 1.2. As the adjudication to the basic issue involved depends upon the amount on which tax has been paid H 266 SUPREME COURT REPORTS (2008] 16 S.C.R A by the selling dealer, it would be appropriate to permit the assessee to produce the books of accounts for adjudication before the concerned Deputy Commissioner .. Assessees shall produce evidence to show that the tax has been paid by the selling dealer on the illustrative B figure of 100 given in the illustrative figure. The said authority shall verify the correctness of the claim with 'f ~ reference to the documents to be produced. If it is established, tax shall be payable on 10 as per the illustration. Otherwise, the Revenues' stand shall stand c established. [Para 8] [269-H; 270-A-C] CIVIL APPELLATE JURISDICTION : Civil Appeal No. 6694 of 2008. From the final Judgment and Order dated 16.8.2004 of the D High Court of Andhra Pradesh at Hyderabad in TRC No. 36 of 1994. 4 -f Dr. M.V.K. Moorthy, A Chandramohan and
Excerpt shown. Read the full judgment & AI analysis in Lexace.