I would like to know if there is any provision in Sales tax act by which benefit can be taken in following case
Stock of garment amounting to Rs. 25 lakhs was rejected due to out of length and same was rejected by exporter certifier and stamped as rejected. The partner sold the same as scrap and realised Rs 20000/- on which he paid the sales tax. Now the sales tax department raised demand on 25 lacs and matter is in appeal before Commissioner and he has asked the relevant provision under which it can be allowed.
Please advise