Allowed

Akansha Readymade,Amethi Thru. Its Proprietor Mrs. Priti Tandon and Another v. State of U.P. Thru. Prin. Secy. Deptt. of Finance, Lko. and 3 Others

Allahabad HC8 May 2024/117/2024

Case brief

AI extract

What is this about?

In this writ petition, the High Court challenged an appellate order dismissing a tax appeal. The Court held that the Appellate Authority erred in dismissing the appeal without addressing the petitioner's submission regarding stock valuation methodology, as no allegation was made that entries were missing in the books. The order was allowed and the appeal dismissed order was quashed.

What did the court decide?

The writ petition was allowed; the impugned order dismissing the appeal was quashed; the matter was remanded to the Appellate Authority for a fresh decision.

Akansha Readymade,Amethi Thru. Its Proprietor Mrs… — GST and Indirect Tax | Allahabad HC (2024)

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Neutral Citation No. - 2024:AHC-LKO:35566

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Court No. - 19

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Case :- WRIT TAX No. - 117 of 2024 Petitioner :- Akansha Readymade,Amethi Thru. Its Proprietor Mrs. Priti Tandon And Another

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Respondent :- State Of U.P. Thru. Prin. Secy. Deptt. Of Finance, Lko. And 3 Others

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Counsel for Petitioner :- Suresh Kumar Upadhyay Counsel for Respondent :- C.S.C.

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Hon'ble Subhash Vidyarthi,J.

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Heard Shri Ashutosh Pandey, learned counsel for the petitioners and Shri Sanjay Sareen, learned Standing Counsel for the State.

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A supplementary affidavit has been filed by the learned counsel for the petitioners, which is taken on record.

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By means of instant writ petition filed under Article 226 of the Constitution of India, the petitioner has challenged validity of an order dated 29.06.2022 passed by the Assistant Commissioner, State Tax, Sector -I, Ayodhya, whereby tax liability of Rs.1,68,456.70 along with interest of Rs.1,16,388.00 and penalty of Rs.1,68,456/- has been imposed upon the petitioner. The petitioner has also challenged the validity of an order dated 27.12.2023 passed by the Additional Commissioner, Grade-2 (Appeal)-2, State Tax, Ayodhya, dismissing Appeal No.AD0909220072059/2022 filed against the aforesaid order.

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The State Tax Authority had conducted a survey of the petitioner's premises on 28.08.2018 and thereafter had issued a notice to the petitioner stating that during survey, goods worth Rs.46.72 lakhs were found in the petitioner's premises and petitioner could not produce any document regarding bills or stock register etc. It is also recorded in the survey note that the basement of the premises was heavily water logged and it was submerged up to the height of two feet.

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The petitioner submitted an explanation stating that due to heavy rain, the petitioner's accountant had not come on that date and all the

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accounts and other documents were in his custody and, therefore, the accounts could not be furnished before the Survey team. The petitioner further submitted that the survey team has taken the value of the stock on Maximum Retail Price (M.R.P.) basis whereas it ought to have been calculated on the basis of cost of the goods, which was Rs.20,60,729/-.

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The Assistant Commissioner did not accept the explanations of the petitioner and held that the accounts ought to be maintained at the business place. Regarding the petitioner's contention that value of the stock ought to have been assessed on cost basis, the Assistant Commissioner held that the survey was carried out in presence of the petitioner and this plea has not been raised during survey and, therefore, the petitioner was estopped from raising this plea.

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The Appeal filed by the petitioner against the aforesaid order of the Assistant Commissioner has been dismissed by the Additional Commissioner, Grade-2 (Appeal)-2, State Tax, Ayodhya by means of the impugned order dated 27.12.2023 in which although he noted the submission of the petitioner that the value of goods ought to have been assessed on cost basis but he did not gave any finding of this submission of the petitioner. The Appellate Authority held that the petitioner had not made entries in the account books. There was no such allegation to this effect against the petitioner. The only allegation was that the account books were not produced at the time of survey and the second objection was that when the account books were produced, value of the stock was entered in it on cost basis and not on M.R.P. basis. When there was no allegation that the relevant entries were not made in the account books, the Appellate Authority erred in dismissing the Appeal on this ground.

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Accordingly, the order dated 29.06.2022 passed by the Assistant Commissioner, State Tax, Sector -I, Ayodhya is unsustainable in law.

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In view of the aforesaid discussion, the writ petition is allowed and the impugned order dated 27.12.2023 passed by the Additional Commissioner, Grade-2 (Appeal)-2, Ayodhya dismissing the Appeal No.AD0909220072059/2022 is quashed . The matter is remanded to the Appellate Authority for being decided afresh in accordance with law keeping in view the observations made in the order.

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[Subhash Vidyarthi,J.]

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Order Date :- 8.5.2024 -Amit K-

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Digitally signed by :- AMIT KUMAR High Court of Judicature at Allahabad, Lucknow Bench

Akansha Readymade,Amethi Thru. Its Proprietor Mrs. Priti Tandon and Another v. State of U.P. Thru. Prin. Secy. Deptt. of Finance, Lko. and 3 Others

Case brief

What is this about?

What did the court decide?

Akansha Readymade,Amethi Thru. Its Proprietor Mrs. Priti Tandon and Another v. State of U.P. Thru. Prin. Secy. Deptt. of Finance, Lko. and 3 Others

Case brief

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What did the court decide?

What the court decided

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