1993 (7) TMI 316 - HC - VAT and Sales Tax

Summary

Issues: Assessment of taxable turnover, rejection of accounts, treatment of unaccounted sales, justification of Appellate Tribunal's decision.

Assessment of Taxable Turnover:
The revision-petitioner, a registered dealer under the Kerala General Sales Tax Act, reported a taxable turnover of Rs. 37,53,241.10 for the assessment year 1980-81. However, the assessing authority fixed the taxable turnover at Rs. 50,27,550 by adding 5% to the conceded turnover of rubber purchased to cover probable suppressions. Additionally, the sale of 24,000 kgs. of rubber to a specific entity was treated as taxable under section 5A of the Act. Despite appeals, the decision of the authorities below was affirmed, leading to the filing of this revision challenging the Sales Tax Appellate Tribunal's order.

Rejection of Accounts:
During surprise inspections, substantial discrepancies in stock, defective purchase bills, and irregularities in sale invoices were discovered. The records revealed unaccounted transactions, and specific delivery notes related to the sale of rubber were found to be cancelled without proper explanation. The duplicate copies of these notes were not available for verification, leading to the rejection of the accounts by all authorities involved. The conclusion that the accounts were not acceptable and the filed return was not accurate was deemed justified based on these findings.

Treatment of Unaccounted Sales:
The main contention raised was regarding the addition of 24,000 kgs. of crepe rubber as unaccounted sales due to the loss of delivery notes. The assessing authority deemed the plea of lost delivery notes unsustainable, as no timely intimation was provided, no police case was registered, and duplicate copies were not produced for verification. The Appellate Tribunal upheld this decision, emphasizing the failure of the assessee to report the loss promptly and the unexplained delay in providing relevant information. The Tribunal concluded that the assessing authority was justified in treating the quantity of rubber as unaccounted sales, considering the lack of evidence supporting the contrary claim.

Justification of Appellate Tribunal's Decision:
The Court agreed with the Appellate Tribunal's findings, stating that the decision was based on facts and did not contain any legal errors. The Tribunal's determination that the assessee failed to prove the legitimacy of its claims regarding the unaccounted sales was deemed reasonable. Consequently, the revision was dismissed as lacking merit, affirming the order of the Appellate Tribunal.

In conclusion, the judgment upheld the assessment of taxable turnover, justified the rejection of accounts based on discrepancies, supported the treatment of unaccounted sales due to missing delivery notes, and deemed the Appellate Tribunal's decision valid, ultimately dismissing the revision petition.