2015 (9) TMI 157 - HC - VAT and Sales Tax

Levy of tax, surcharge and AST Suppression of Sale slips Asst. Commissioner while entertaining appeal, sustained actual suppressions of slip numbers 1, 2 and 4, but deleted entire estimation with regard to slip No.3 holding that appellant was suffering from nervous disorder at time of enquiry and it related to only jottings made by appellant Joint Commissioner revised order of Asst. Commissioner restoring turnover involving tax, surcharge and additional sales tax on grounds that Whether suppression of sales under Slip No.3 could be deleted or not Held that - Appellate Assistant Commissioner erred in allowing contentions of assessee on grounds of nervous disorder of assessee, while giving deposition and that slip denoted only jottings Plea of ill health during time of enquiry and subsequent dates was only after thought, as was rightly observed by Revisional Authority Assesse had full knowledge of details contained in Slip No.3 and he had given statement before Authority, which formed basis of original assessment order From facts, it was clear that it was suppression of sales No reason to interfere with order passed by Joint Commissioner in suo motu proceedings Decided against Assesse.

Issues:
Assessment of sales suppression based on inspection findings and recovered slips; Appeal against the assessment order; Revision by Joint Commissioner in suo motu proceedings; Disputed suppression of sales under Slip No.3; Applicability of tax, surcharge, and additional sales tax on suppressed turnover.

Detailed Analysis:

1. Assessment of Sales Suppression:
The appellant, a dealer in aluminium vessels, was assessed for the assessment year 1991-92 based on an inspection that revealed variations in stock and recovered slips indicating business transactions. The Assessing Officer found suppression of sales related to certain slips, leading to a tax assessment and penalty. The Appellate Assistant Commissioner upheld the suppression based on some slips but granted relief for Slip No.3, citing the appellant's nervous disorder during the inspection.

2. Appeal Against Assessment Order:
The Joint Commissioner, finding the Appellate Assistant Commissioner's decision prejudicial to revenue, initiated suo motu revision proceedings. The Joint Commissioner revised the order, restoring a turnover involving tax, surcharge, and additional sales tax. The appellant challenged this order, arguing that the finding on Slip No.3 should not be overturned as it did not show suppression of sales independently.

3. Revision by Joint Commissioner:
The core issue revolved around the suppression of sales under Slip No.3. The Original Authority relied on the partner's statement, recorded after the inspection, to conclude suppression of sales. The Appellate Assistant Commissioner granted relief for Slip No.3 due to the partner's alleged nervous disorder. However, the Revisional Authority rejected the plea of ill health, emphasizing that the partner had full knowledge of the business activities and that Slip No.3 indicated suppressed sales.

4. Disputed Suppression of Sales under Slip No.3:
The Revisional Authority thoroughly examined Slip No.3, concluding that it demonstrated suppressed sales through calculations indicating total sales value. The Revisional Authority's findings supported the restoration of the turnover and imposition of taxes, surcharge, and additional sales tax. The Revisional Authority's order was upheld, dismissing the appellant's appeal.

5. Applicability of Tax and Surcharge:
The court found that the Revisional Authority's decision was well-founded, emphasizing that the appellant's plea of ill health was an afterthought. The court agreed with the Revisional Authority's analysis of Slip No.3, affirming that it indicated suppressed sales. The court upheld the order passed by the Joint Commissioner in the suo motu proceedings, dismissing the Tax Case (Appeal) without costs.

In conclusion, the judgment upheld the Revisional Authority's decision regarding the suppressed sales under Slip No.3, emphasizing the partner's knowledge of the business activities and dismissing the appellant's plea of ill health as an afterthought. The court found no reason to interfere with the order passed by the Joint Commissioner, leading to the dismissal of the Tax Case (Appeal).

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