1. This is a reference on a statement of the case submitted by the Maharashtra Sales Tax Tribunal under section 34(1) of the Bombay Sales Tax Act, 1953 (referred to hereinafter as 'the said Act'.)
2. The relevant facts giving rise to this reference are as follows :
The respondent is a dealer registered under the said Act. The assessment periods with which we are concerned are the periods from 1st April, 1958, to 31st March, 1959, and 1st April, 1959, to 31st December, 1959, respectively. A common statement of the case has been submitted in respect of two reference applications, namely, reference applications Nos. 51 and 52 of 1965 respectively relating to the aforesaid two assessment periods, and really speaking, there should have been two references filed by the Commissioner. However, as the reference arises from a common statement of the case, we are disposing it of as it is at the request of both the parties in respect of the aforesaid periods. It appears that it was found by the Sales Tax Officer that purchases worth Rs. 947.93 Ps. made by the dealer from one M/s. Aggarwal & Company, Bombay on 18th February, 1959, were not accounted for by the dealer in his books of account. Similarly, purchases of 152 rounds and 70 pattas (iron and steel goods) from Jethalal Mohanji of Bombay in 1959 were not accounted for by the dealer in his books of account. The Sales Tax Officer also detected from the octroi books of the toll naka of Sangli that goods worth Rs. 9,580 in the year 1958-59 and Rs. 10,370 in the year 1959-60 were found to have been sent to Bombay in the name of the dealer and these transactions had not been accounted for in the dealer's account. On the basis of this material, the Sales Tax Officer rejected the books of account of the dealer and enhanced the gross turnover of the dealer by 33 1/3 per cent. From the various orders on record, it appears that the gross turnover of the dealer was increased by the Sales Tax Officer by 33 1/3 per cent. In respect of the period 1st April, 1958, to 31st March, 1959, the gross turnover of sales, as seen from the books of account, was increased from Rs. 1,90,898 to Rs. 2,54,530 and the gross turnover of purchases (as per accounts) was increased from Rs. 1,46,286 to Rs. 2,22,987. In respect of the period 1st April, 1959, to 31st December, 1959, the gross turnover of sales was increased from Rs. 1,82,119 (as per books of account) to Rs. 2,42,898 and the gross turnover of purchases was increased from Rs. 1,62,236 (as per the books of account) to Rs. 2,13,769. The dealer preferred appeals against these orders to the Assistant Commissioner of Sales Tax. The Assistant Commissioner reduced the enhanced turnover from 33 1/3 per cent to 25 per cent. Apart from this, in respect of the period 1st April, 1958, to 31st March, 1959, he treated only purchases of Rs. 33,818 as from unregistered dealers and the rest of the enhanced purchases as from registered dealers and entitled to the benefit of the exemption provided in section 8(a) of the said Act. Similarly, in the period 1st April, 1959, to 31st December, 1959, he treated only purchases of Rs. 20,498 as from unregistered dealers as against the enhanced purchases as Rs. 36,158. The dealer then preferred revisional applications against these orders to the Deputy Commissioner. In respect of the findings as aforesaid, the Deputy Commissioner did not interfere except that he reduced the estimate of enhanced purchases from unregistered dealers in respect of the period 1st April, 1959, to 31st December, 1959, from Rs. 20,498 as made by the Assistant Commissioner to Rs. 18,307. The dealer then preferred further revisional applications to the Sales Tax Tribunal. Several contentions were advanced before the Tribunal with which we are not concerned. The Tribunal did not accept the arguments of the dealer to the effect that no new enhancement in the turnover should have been made at all. The Tribunal, however, agreed with the contentions of Mr. Patel, who appeared for the dealer, that the enhanced turnover of Rs. 47,725 in respect of the period 1st April, 1958, to 31st March, 1959, and Rs. 45,545 in respect of the period 1st April, 1959 to 31st December, 1959 should be bifurcated into the free and taxable turnover on the basis of the proportion of tax free sales, 'O.B.S. Sales' which means inter-State sales, and sales taxable at different rates as disclosed by the books of account and were acceptable to the assessing authorities. The Tribunal has gone on the observe as follows :
'Since the Deputy Commissioner of Sales Tax has granted him exemption of 50 per cent under section 8(a) in respect of the enhanced turnover, we do not wish to disturb the same. The rest of the exemption in respect of the sales out of enhanced turnover should be worked out on the basis of the proportion of these exemptions as revealed by the books of account and accepted by the department. The quantum of purchases to be enhanced should be also worked out and classified on the same in the proportion of the purchases under different heads such as R.D. (Registered dealers), U.R.D. (unregistered dealers) and O.B.S. (outside Bombay sales or inter-State sales) and entries 1 to 18 of Schedule B as revealed by the books of account and accepted by the officer'. (bracketed portions supplied by us.)
3. We may make out clear that the facts which we have set out aforesaid had to be gathered by us from the various orders, namely, the orders of the Sales Tax Officer, Assistant Commissioner and the Deputy Commissioner as unfortunately, the statement of the case does not set out most of the relevant facts. It should be made once again clear to the Tribunal that it is the Tribunal which is the final fact finding authority and the statement of the case prepared and furnished by the Tribunal should set out the relevant facts clearly and precisely. The reason for providing for a statement of the case is that the Court should not have to roam over the whole record to find out the relevant facts. It is unfortunate that the statement of case in this case is wholly unsatisfactory. Fortunately, there is no controversy over these facts. But the above observations should be borne in mind by the Tribunal when a statement of the case is to be formulated. It is desirable that when a reference is made, a draft statement of the case should be prepared and both the sides should be given opportunity of being heard and then the final statement of case should be prepared incorporating all the relevant facts as found by the Tribunal. We do hope, the Tribunal will keep this in mind in future.
4. Arising from the aforesaid decision of the Tribunal, the following questions have been referred to us for determination :
1. Whether the Tribunal was justified in law in coming to the conclusion that the sales tax authorities ought to have bifurcated the enhanced turnover of Rs. 47,725 (Reference Application No. 51 of 1965) and Rs. 45,545 (Reference Application No. 52 of 1965) into tax-free and taxable turnover on the basis of the proportion of tax free sales, outside Bombay State sales and taxable sales at different rates as were disclosed by the books of account in respect of other turnover and as were acceptable to the assessing authorities ?
2. Whether the Tribunal was justified in law in directing that the quantum of purchases to be enhanced should also be worked out and classified on the same basis in the proportion of the purchases under different heads such as registered dealers, unregistered dealers, outside Bombay State and entries 1 to 18 of Schedule B as revealed by the books of account in respect of other turnover and accepted by the officer ?
5. In order to appreciate these questions, it is not necessary to set out in detail any particular provision of the said Act. It may, however, be pointed out that the tax-free sales referred to are those which are covered by section 7 of the said Act, which pertains to the goods, the sale and purchase of which is free from all taxes under the said Act. Outside Bombay State sales referred to are inter-State sales which are liable to be taxed at a reduced rate, and taxable sales at different rates are sales of goods described in the various items in Schedule B to the said Act. In respect of these goods, sales thereof are not liable to the levy of sales tax but sales and purchases thereof are liable to the levy of general sales tax and purchase tax respectively at the rates prescribed under the said Schedule. The result is that the sales and purchases in these goods are liable to tax at reduced rates. As far as sales to registered dealers and purchases from registered dealer are concerned, section 8 provides for deduction of such sales from the turnover provided the conditions set out in the said section are satisfied. As far as question No. 1 is concerned, it will be noticed that that question pertains to bifurcation of enhanced turnover of sales in respect of the aforesaid assessment periods into tax-free and taxable turnovers and turnover taxable at lower rates on the basis of the proportion of the tax-free sales, inter-State sales and sales liable to tax at different rates or concessional rates as disclosed by the books of account of the dealer. There is no reference in that question to any bifurcation on account of sales to registered dealers at all nor is there any reference to any bifurcation on account of sale of goods which, in turn, were purchased from registered dealers. In respect of that question, the submission of Mr. Jetley, the learned counsel for the department was that as the enhancement in the turnover was made on account of certain suppression of sales detected, no benefit could be extended on the aforesaid basis in respect of any part of the said turnover. It is difficult to accept this contention. In the first place, it is not as if the enhancement is limited to the actual amount of suppression. It is on account of the suppression of purchases and goods consigned to the dealer found by the Sales Tax Officer, that the dealer's books of account were rejected and an estimate of turnover was made. It is significant that the enhancement is not of the taxable turnover alone, but of the gross turnover and hence we fail to see any reason why the dealer was precluded from claiming that a part of the said enhanced turnover of sales was attributable to tax-free sales or inter-State sales or sales liable to tax at different rates. If the Sales Tax Officer wanted to increase the net or taxable turnover, it was always open to him to do so, but what he has done is to enhance the gross turnover on an estimated basis and there is no reason in principle why the dealer should be debarred from claiming any of the deductions referred to above in respect of the enhanced turnover.
6. The next submission of Mr. Jetley was that the burden of proving that a particular sale was tax-free or liable to tax at a reduced rate or entitled to an exemption was on the dealer and as he had failed to discharge any such burden, in fact having made no attempt to do so, he could not claim any benefit on this account. In support of this submission, Mr. Jetley relied upon the decision of a Division Bench of this Court in Hirjee v. State of Maharashtra  18 STC 460. As against this, Mr. Patel relied upon the decision of a Division Bench of this Court in Commissioner of Sales Tax v. Kutubali Noorjibhai & Co.  36 STC 523. In our view, it is not open to us to consider this argument of Mr. Jetley at all. From the statement of the case, it is clear that the department had sought to raise a specific question as follows :
'Whether the burden of proving that any part of his turnover of either sales or purchases consists of sales or purchases of goods covered by entries 1 to 18 of Schedule B to the Bombay Sales Tax Act, 1953, lies upon the assessee ?'
In paragraph 12 of its order an the reference applications, the Tribunal has held that this question as well as some other questions sought to be raised by the Commissioner did not arise from the order of the Tribunal at all. No application has been made for directing the Tribunal to refer that question to us. This would show that the question of burden of proof was not agitated before the Tribunal at all and the judgment of the Tribunal on the revisional applications makes that point clear. In view of this, it is not open to Mr. Jetley to raise the aforesaid contention at all, as that contention was nowhere raised before the Tribunal. Apart from this, had such a contention been raised, the dealer would have been put on guard and might have sought to discharge the burden in such manner as he thought best. It would thus be unfair to allow the department to raise that contention here. What the Tribunal has done is to consider the pattern of sales disclosed by the books of account of the assessee to the extent that the said pattern has been accepted by the sales tax authorities and to have directed that even in respect of the enhanced turnover, the same pattern should be applied and the assessment to sales tax made accordingly. The Tribunal is the final fact finding body. The enhancement of the turnover was on the footing of a best judgment assessment and the Tribunal being the final fact finding body, on the material before it, directed that the said enhancement, as far as the enhancement of the turnover of sales is concerned, should be bifurcated as aforesaid. We do not see how we can say that the Tribunal has committed any error in law in doing so. Question No. 1 must, therefore, be answered in the affirmative and in favour of the dealer.
7. We come next to question No. 2. As the perusal of the question would show, the question relates to the enhancement of the turnover of purchases. In view of what we have observed earlier regarding the enhancement of the turnover of the sales, it is clear that the Tribunal was justified in directing that the quantum of purchases to be enhanced should also be worked out and classified on the basis of the proportion of purchases under different heads, like outside Bombay State sales, i.e., inter-State sales and sales of goods referred to in entries 1 to 18 of Schedule 'B'. The question, however, which remains to be considered is in so far as the Tribunal has further directed the said enhanced turnover of purchases to be bifurcated also taking into account purchases from registered dealers. In this regard, we find that the Assistant Commissioner had already treated about 50 per cent of the said enhanced turnover of purchases as being the purchases from the registered dealers and entitled to benefits as such. He had limited the enhancement to about 50 per cent as on account of purchases from the unregistered dealers. The Deputy Commissioner has reduced the amount of enhanced purchases, treated as having been made from unregistered dealers by a little less than Rs. 2,000. The passage of the judgment of the Tribunal which we have already set out, indicates that the Tribunal did not see any reason to interfere with the conclusion of the Deputy Commissioner in this regard. The result of this would be that as far as the enhancement in the quantum of turnover of purchases is concerned, the dealer has already got the benefit to the extent of 50 per cent on account of such purchases being treated as having been made from registered dealers and entitled to the benefit of the provisions of section 8 of the said Act. As we have already said, the Tribunal expressed no desire to interfere with the determination of this percentage. In view of this, there is no basis on which the Tribunal could have again directed that in respect of remaining enhanced turnover, there should be a further bifurcation on the ground that some of the purchases constituting the said enhanced turnover must have been from the registered dealers.
8. Mr. Patel, however, contended that in a case of best judgment assessment, it was the Tribunal which had the last word as the final fact finding authority and the Court could not interfere with the decision of the Tribunal regarding bifurcation of the enhanced turnover of purchases. In support of this argument, Mr. Patel relied upon the decision of the Supreme Court in Commissioner of Income-tax, West Bengal III v. Kamal Singh Rampuria : 75ITR157(SC) . In that case, the Supreme Court held that it is well established that the High Court is not a court of appeal in a reference under section 66 of the Indian Income-tax Act, 1922, and it is not open to the High Court in such a reference to embark upon a re-appraisal of the evidence and to arrive at findings of fact contrary to those of the Appellate Tribunal. We fail to see how this decision in any way helps Mr. Patel in the present case. We may make it clear that we are not seeking to interfere with any finding of fact arrived at by the Tribunal at all. We have pointed out above that the Tribunal itself has accepted the conclusions of the Deputy Commissioner that 50 per cent of the enhancement in the turnover of purchases should be attributable to purchases from registered dealers and has accepted the reliefs given by the Deputy Commissioner on that basis. There is no finding of fact given by the Tribunal which would lead to the conclusion that even in respect of the balance of the enhanced turnover, there should be a further bifurcation on account of certain purchases being attributable to having been made from the registered dealers. In fact, the direction given by the Tribunal to this extent appears to run contrary to its own findings. As far as question No. 2 is concerned, it will be answered in the following manner :
The Tribunal was justified in directing that the quantum of purchases enhanced should also be worked out and classified on the same basis as set out in question No. 1 in proportion of the purchases under different heads, such as outside Bombay State sales or inter-State sales and sales of goods covered by entries 1 to 18 of Schedule B as revealed by the books of account in respect of the other turnover and accepted by the Sales Tax Officer, but it was not justified in directing that any proportion of the enhanced turnover of purchases should be attributed to purchases from registered dealers.
9. Looking to all the facts and circumstances of the present case, there will be no order as to costs of this reference.