1977 (10) TMI 93 - HC - VAT and Sales Tax

Summary

Issues involved:
The issue involves the cancellation of penalties imposed under section 16(2) of the Tamil Nadu General Sales Tax Act, 1959, for the assessment years 1965-66 and 1966-67 based on the grounds of wilful non-disclosure of assessable turnover.

Judgment Details:

The High Court of Madras addressed the issue of penalty cancellation under section 16(2) of the Act for the years 1965-66 and 1966-67. The Tribunal had set aside the penalties imposed by the assessing authority due to the lack of a specific finding on wilful non-disclosure of assessable turnover. However, the Sales Tax Officer had noted the dealer's wilful suppression of a significant turnover, indicating the deliberate nature of the non-disclosure. The Court emphasized that mere reassessment based on best judgment does not prove wilful non-disclosure; there must be evidence of deliberate intent to conceal assessable turnover that actually existed. Therefore, the Tribunal cannot solely rely on the absence of a finding but must consider the requirements of the section and the deliberate nature of non-disclosure.

In light of the above analysis, the High Court set aside the Tribunal's order canceling the penalties for the years 1965-66 and 1966-67. The Appellate Tribunal was directed to reconsider the matter and make appropriate decisions in accordance with the law. Each party was instructed to bear their respective costs.