S.T.A. No.2443/LB of 2001, decided on 17th April, 2002. Versus S.T.A. No.2443/LB of 2001, decided on 17th April, 2002.

1. MIAN ABDUL QAYYUM, MEMBER (JUDICIAL).-- This appeal is directed against the Order-in-Original No.201 of 2001, dated 18-9-2001 (dispatched on 21-9-2001) passed by the learned Additional Collector (Adjudication), Lahore.

2. The staff of the Directorate of Revenue Receipts Audit, Lahore after examining the record of the appellant for the year 1997-98 observed that the appellant had short paid sales tax amounting to Rs.5,48,819 as per the following details given in the show-cause notice, dated 17-4-2002 issued by the then learned Additional Collector Sales Tax, Lahore:

2. "S. No.

3. Tax period supply value of

4. Exempt: supplies

5. Taxable supply

6. Input tax

7. Claim

8. Input Tax admissible u/s.8.(2)

9. Input Tax

10. Incorrectly

11. 1

12. 07/97

13. 825000

14. 11290974

15. 109375

16. 2

17. 08/97

18. 13132938

19. 84972057

20. 20465

21. 3

22. 09/97

23. 11229745

24. 11437343

25. 406148

26. 4

27. 10/97

28. 6873815

29. 2825916

30. 84547

31. 5

32. 11/97

33. 16531567

34. 16453668

35. 37029

36. 6

37. 12/97

38. 2481198

39. 2206633

40. 130777

41. 223522

42. 548819"

3. The allegation against the appellant was that it had claimed input tax adjustment in respect of supplies which were exempt under the provisions of the Sales Tax Act and had thus violated S.R.O. No.698(I)/96, dated 22-8-1996. The appellant resisted the, show-cause notice by claiming that the inputs claimed related to tax paid supplies.

4. Para 3 and 4 of the impugned order show that the case was pending with the then learned Additional Collector Sales Tax who had issued the notice but thereafter it was transferred to the learned Additional Collector (Adjudication), Lahore in April, 2002 who issued hearing dates for 29-8-2001, 5-9-2001 and 18-9-2001.

5. According to para 5 none of the parties appeared before the learned Adjudicating Officer on any of these dates and he decided the case ex parte on the basis of available record by holding the appellant responsible for payment of evaded sales tax amounting to Rs.5,48,891 alongwith Additional Tax and penalty of Rs.27,441. Hence, this appeal.

6. During the course of arguments on 25-10-2001 learned counsel for the appellant seriously asserted that none of the notices alleged to have been sent to the appellant for 29-8-2001, 5-9-2001 and 18-9-2001 were ever served on it and that the impugned order was, therefore, an ex parte order which was passed without hearing the appellant. In order to verify the real position, the learned D.R. was asked to make available the relevant record to prove that these notices were actually received by the appellant and it deliberately did not put in. appearance before the learned Adjudicating Office. The learned D. R: failed to produce the said record on 11-12-2001, 27-2-2002 and even today. The basic law is that if a party fails to produce the record which it claims to be in its possession then the presumption is raised against it and the presumption is that if the said record was produced then it would go against it. We can, therefore, safely infer that either the department is not in possession of any of these notices or is deliberately avoiding to produce the same before the Tribunal. In this back ground of facts it can rightly be assumed that these notices may not have been issued for 29-8-2001. 5-9-2001 and 18-9-2001 and may not have been served on the appellant. This being the position, the impugned ex parte order militates against the basic law that no one is to be condemned unheard. The result is that the impugned order is set aside and the case is remanded to the learned Adjudicating Officer for a fresh decision in accordance with law after hearing the parties and after receiving the evidence which they may like to produce.

43. C.M.A.706/Tax (Trib.) Case remanded.