1998 (8) TMI 566 - HC - VAT and Sales Tax

Summary

Issues:
1. Revision petition under section 23(1) of the Karnataka Sales Tax Act, 1957 challenging the order of the Karnataka Appellate Tribunal.
2. Assessment of purchase turnover suppression and penalty imposition.
3. Appeal before the Joint Commissioner of Commercial Taxes (Appeals) and subsequent appeal before the Tribunal.
4. Contention regarding non-accounting of purchase turnover and compounding of the offence.
5. Legal challenge against the order passed by the C.T.O. (Intelligence) and rejection of books of accounts.

Analysis:
1. The petitioner, a partnership firm, declared gross turnover and taxable turnover for the assessment year 1990-91. An inspection revealed unaccounted purchase bills, leading to an admission of the offence by the petitioner. The assessing authority proposed a best judgment assessment due to discrepancies in maintaining books of accounts, resulting in the addition of suppressed sales to the declared turnover and a penalty under section 12(4) of the Act.

2. The petitioner appealed the assessment before the Joint Commissioner of Commercial Taxes (Appeals), who partially allowed the appeal by reducing the additions to the declared turnover and the penalty amount. Subsequently, the petitioner filed a second appeal before the Tribunal challenging the rejection of the appeal by the Appellate authority.

3. The Tribunal upheld the rejection of the appeal based on the admission made by the petitioner regarding the suppressed purchase turnover, supported by lorry receipts. The petitioner's argument that they were not the buyers of the goods under the lorry receipts was dismissed by the Tribunal. The Tribunal found no evidence of coercion in the petitioner's admission statement, leading to the rejection of the appeal.

4. The petitioner's counsel contended that the order passed by the C.T.O. (Intelligence) was void and violated principles of natural justice. However, the Court held that the compounding of the offence by the petitioner precluded them from challenging the order. The Court cited precedents to support the principle that once an offence is compounded, the party cannot subsequently challenge it.

5. The Court dismissed the petitioner's contentions, emphasizing that the assessing authority was justified in rejecting the books of accounts and resorting to best judgment assessment based on the admission made by the petitioner. The Court clarified that the revision to the Court lies on a question of law only, and since the findings were factual, no interference was warranted. The Court distinguished relevant case laws cited by the petitioner's counsel, concluding that they were not applicable to the present case.

In conclusion, the Court found no merit in the revision petition and dismissed it without costs.