ORDER
S.K. Mal Lodha, J.
1. This is an application under Section 15(3A) of the Rajasthan Sales Tax Act, 1954 (Act No. 29 of 1954) (for short 'the Act' herein), for requiring the Board of Revenue to state the case and refer the following questions of law arising out of its order dated 9th February, 1981, passed in Special Appeal No. 4/78/RST/Pali.
1. Whether, under the facts and in the circumstances of the case, deductions under Section 2(s) can be allowed without producing S.T. 17 forms physically on original or duplicate as envisaged under Sub-rule (7) of Rule 25C?
2. Whether, under the facts and circumstances of the case, secondary evidence as produced by the dealer can be taken into consideration if the original and duplicate S.T. 17 forms are lost ?
2. The dealer-assessee, M/s. Lalchand Kapoorchand of Sumerpur, District Pali, non-petitioner, sold cotton seeds, which were taxable at the last point at a price of Rs. 8,056 to another registered dealer without charging sales tax from him. The accounting period is 22nd October, 1968, to 9th November, 1969. During the assessment proceedings, the dealer-assessee claimed that sale price of cotton seeds should not be included in the taxable turnover as defined in Section 2(s) of the Act. This was so claimed by him on the ground that he had sold the cotton seeds to the purchasing dealer after obtaining declaration from him in form S.T. 17 that he will sell the cotton seeds within the State of Rajasthan. The dealer-assessee did not produce form S.T. 17 marked 'original' or 'duplicate' but only produced a true copy of form S.T. 17 on plain paper. The assessing authority included the sale price of cotton seeds amounting to Rs. 8,056 in the dealer-assessee's taxable turnover and taxed it at 3 per cent amount being Rs. 241.68, vide assessment order dated 30th September, 1970. An appeal was filed by the dealer-assessee. He also submitted an affidavit and the certificate from the purchasing dealer M/s. Nemichand Shantilal. It was declared therein that cotton seeds were purchased for resale in Rajasthan against form S.T. 17 and that the purchasing dealer had sold the cotton seeds in Rajasthan and had deposited the tax on these cotton seeds in Government Treasury. The dealer-assessee filed an affidavit stating that the 'original' and 'duplicate' of form S.T. 17 had been lost in transit and, therefore, its true copy was filed before the assessing authority. The Deputy Commissioner (Appeals), Commercial Taxes, Jodhpur, by his order dated 30th June, 1971, held that it would be against the natural justice and improper to charge tax from the dealer-assessee on the said transaction when tax was paid by the purchasing dealer and when under the law the tax is leviable only at one point. He, therefore, deleted the levy of tax on the turnover of the cotton seeds sold by the dealer-assessee. The assessing authority filed a revision before the Board of Revenue for Rajasthan at Ajmer (for short 'the Board'). That was dismissed by the single Member of the Board by judgment dated 16th May, 1978. We may usefully extract the following from the judgment of the single Member of the Board:
It is not necessary that S.T. forms should be physically produced... In the present case rather the dealer has produced the certificate of the purchasing dealer that the tax has been paid by them. Under these circumstances I do not find any reasons to interfere with the judgment passed by the Deputy Commissioner (Appeals).
3. Aggrieved, the assessing authority filed a special appeal before the Division Bench of the Board, which was dismissed by order dated 9th February, 1981. The relevent observations made by the Board are these:
Sub-rule (7) of Rule 25C of the Rajasthan Sales Tax Rules prescribes that the dealer should produce the portion marked original of the declaration received from the purchasing dealer. In case of loss of the original foil, the assessing authority has been empowered in this sub-rule to direct the selling dealer to produce for inspection the portion of the declaration marked duplicate. This sub-rule does not envisage a situation where both the original and the duplicate are lost as appears to be the situation in the case before us. The only alternative in such circumstances could have been to rely on other secondary evidence. The appellate authority and the learned Member of the S.B. of the Board rightly allowed the deduction from the taxable turnover of this amount.
4. An application under Section 15(1) of the Act was filed by the assessing authority before the Board and as it was not disposed of within 180 days from the date of its filing as aforesaid, this application under Section 15(3A) of the Act was filed.
5. This application under Section 15(3A) of the Act was pending on 1st May, 1985, in this Court. In view of the provisions contained in Section 13(10) of the Rajasthan Sales Tax (Amendment) Act, 1984 (No. 20 of 1984) (for short 'the Amendment Act' herein), it has to be treated as a revision under Section 15 of the Act as substituted by the Amendment Act. Under Section 15 of the Act in revision question of law arising out of the order can be considered. We have treated this application as a revision.
6. We have heard Mr. K.C. Bhandari, learned Counsel for the assessing authority. Nobody has appeared on behalf of the dealer-assessee.
7. The question of law involved is whether the Board was right in this case in upholding the order of the Deputy Commissioner (Appeals), Commercial Taxes, by which the levy of tax was deleted on the turnover of Rs. 8,056 despite the fact that 'original' and/or 'duplicate' of form S.T. 17 were not filed with the return as the same are said to have been lost and only a true copy of form S.T. 17 on plain paper was filed. This has necessitated for us to first notice Section 2(s) of the Act, which is as under:
(s) 'taxable turnover' means that part of turnover which remains after deducting therefrom the aggregate amount of the proceeds of sale of goods--
(i) on which no tax is leviable under this Act,
(ii) which have already been subjected to tax under this Act,
(iii) which have been sold to persons outside the State for consumption outside the State, and
(iv) which are taxable at a point of sale within the State subsequent to the sale by the dealer and such sale is covered by a declaration as may be required under any provision of this Act or the Rules made thereunder:
Provided that where a dealer in goods which are exempted from tax unconditionally, sells any bardana, container or any other packing material received along with such goods at the time of purchase thereof by him, the taxable turnover in respect of such sales shall, at the option of such dealer to be exercised in the prescribed manner, be one per cent of the aggregate amount of the sale prices received or receivable by him in respect of the sale or supply of such goods and of such bardana, container or material:
Provided further that when any dealer has purchased any goods without paying any tax on the strength of any declaration furnished by him and the said goods are used by him for any purpose other than the one mentioned in the declaration, the purchase price of such goods shall be included in his taxable turnover.
8. Reference to the provisions of the Act and the Rules herein is to those which existed during the relevant time.
9. The material part of Rule 25C of the Rajasthan Sales Tax Rules, 1955 ('the Rules'), runs as under:
25C. Furnishing of declaration.--(1) A dealer who is entitled to any claims--
(i) exemption from payment of tax; or
(ii)...
shall in respect of each such sale, obtain a declaration from the purchasing dealer in form S.T. 17 and shall, along with the return under Rule 25, file all declarations obtained as aforesaid and also submit a separate list of such sales in form S.T. 16.
Sub-rule (7) of Rule 25C of the Rules which is relevant for our present purpose is as follows:
(7) A dealer who claims to have made such sales as are envisaged in Sub-Rule (1) to another dealer shall in respect of such claim, produce before the assessing authority the portion marked 'original' of the declaration received by him from the purchasing dealer. The assessing authority may in his discretion or in case of loss of the original foil of the declaration may direct the selling dealer to produce for inspection or record the portion of the declaration marked 'duplicate'.
10. The contention of the learned Counsel for the assessing authority is that it is a mandatory requirement of Rule 25C(1) that the dealer-assessee should have submitted the declaration from the purchasing dealer in form S.T. 17 with the return. A discretion has been given to the assessing authority to receive the declaration in form S.T. 17 marked 'duplicate'. The assessing authority has also been empowered in the case of loss of the 'original foil' of the declaration to direct the selling-dealer to produce for inspection or record the portion of the declaration marked 'duplicate'. In this case, contended by the learned Counsel for the assessing authority, that neither the 'original' nor the 'duplicate' of the declaration was produced at any point of time by the assessee-dealer and so the exemption from payment of tax should not have been granted to him and as such the turnover to the extent of Rs. 8,056 was taxable. In Rule 25C(1) of the Rules the word 'shall' has been used making it incumbent upon the dealer-assessee to obtain a declaration from the purchasing dealer in form S.T. 17 and also to submit it with the return filed under Rule 25. Under Sub-rule (7) of Rule 25C the dealer who claims exemption from payment of tax under Rule 25C(1) is required to produce before the assessing authority the declaration of the portion marked 'original' received by him from the purchasing dealer. The contingency of loss of the 'original foil' of the declaration contained in form S.T. 17 has also been contemplated and in such a case the assessing authority can direct the selling dealer to produce for his inspection or record the portion of the declaration marked 'duplicate'. A careful reading of Sub-rule (7) of Rule 25C of the Rules makes it abundantly clear that for claiming exemption under Rule 25C(1) production of 'original foil' and in case of its loss, production for inspection or record of the portion of the declaration marked 'duplicate' is necessary. The filing of the declaration in form S.T. 17 with the return is mandatory and that too in 'original' and in case of loss in 'duplicate'. In this connection, we may notice the authorities that were cited by the learned Counsel for the assessing authority. The provisions contained in Section 5(2)(a)(ii) of the Bengal Finance (Sales Tax) Act, 1941, and Rule 27-A of the Bengal Sales Tax Rules, 1941, came up for consideration in Kedarnath Jute . v. Commercial Tax Officer [1965] 16 STC 607 (SC). Under Section 5(2)(a)(ii) of the Bengal Finance (Sales Tax) Act, 1941, a dealer can claim exemption in regard to sales to a registered dealer by furnishing declaration forms under the aforesaid provision issued by the purchasing dealer. The question arose whether the dealer could get exemption without furnishing the declaration in the prescribed form. It was ruled that the furnishing of the declaration forms under Section 5(2)(a)(ii) is a condition for claiming the exemption and the dealer has to strictly comply with the provision and cannot produce other evidence to prove that the sales to the registered dealers were for the purposes mentioned in the sub-clause. The argument given in support of the view by the Apex Court of the country was that the provisions prescribing the exemption are to be construed strictly. A contention was raised in that case on behalf of the assessee that various attempts were made to get the duplicate forms of declaration from the dealer but on account of the circumstances over which it had no control and because of the unhelpful and hostile attitude of the Commercial Tax Officer within whose jurisdiction the said dealer functioned, it was not able to furnish the duplicate forms, for, all the declarations that were lost. In this connection, it was observed that Section 21A of the aforesaid Act cannot be availed of by a dealer who loses the declaration forms issued to him by registered dealer for the purpose of asking the Commercial Tax Officer to summon the dealers to produce the necessary documents in order to prove that they had issued the declaration forms to him. Kedarnath Jute Manufacturing Co.'s case [1965] 16 STC 607 (SC) clinches the issue before us.
11. In this case, the Board in the special appeal, as stated above, observed that Rule 25C(7) of the Rules does not envisage a situation where both the original and the duplicate are lost and, therefore, in such a situation there was no alternative but to rely on the secondary evidence furnished by the dealer-assessee with the return which consisted of a true copy of the declaration in form S.T. 17 on plain paper and in appeal the certificate of the purchasing dealer supported by affidavit. According to the single Member, Rule 25C(7) cannot be invoked in such a situation. The Division Bench agreed with the view taken by the Deputy Commissioner (Appeals) that no tax could be imposed on the turnover of Rs. 8,056. We have already held that Rule 25C(7) of the Rules, it was incumbent upon the dealer-assessee for claiming exemption from payment of tax to produce in original the declaration in form S.T. 17 and if it has been lost the duplicate. This was not done in this case.
12. In this view of the matter, the Deputy Commissioner (Appeals) as well as the learned Member and the Division Bench of the Board were not right in deleting the levy of tax by the Commercial Taxes Officer, for, Rule 25C(1) and (7) of the Rules were disregarded and further no other evidence except that of the 'original' or 'duplicate' of the declaration in form S.T. 17 could only be considered by the assessing authority.
13. The result is that this application which has been treated as a revision under Section 13(1) of the Amendment Act, is allowed and the order dated 30th June, 1971, of the Deputy Commissioner (Appeals), Jodhpur, order dated 16th May, 1978, of the single Member of the Board, order dated 9th February, 1981, of the Division Bench of the Board are set aside and the assessment order dated 30th September, 1970, of the assessing authority is restored in so far as it was held that the sale price of cotton seeds amounting to Rs. 8,056 should be included in the taxable turnover and the tax is leviable at 3 per cent amounting to Rs. 241.68.
14. As nobody has appeared on behalf of the dealer-assessee, there will be no order as to costs.