1980 (9) TMI 288 - HC - VAT and Sales Tax

Summary

Issues:
Assessment of gross turnover discrepancy, rejection of accounts due to lack of cash memos and separate trading accounts, statutory obligation to issue cash memos, enhancement of disclosed turnover based on previous history.

Analysis:
1. The case involved a partnership firm engaged in the business of dry fruits and ice, where the assessing officer disputed the disclosed gross turnover due to a discrepancy of &8377; 808.52, absence of cash memos, and failure to maintain separate trading accounts for taxable and non-taxable goods. The assessing officer estimated the net turnover at &8377; 1,70,000 after rejecting the accounts.

2. Upon appeal, the appellate authority upheld the rejection of accounts but reduced the taxable turnover to &8377; 1,67,000. Subsequently, in revision, the Additional Judge confirmed the rejection of accounts citing the absence of cash memos and separate trading accounts. The Additional Judge also upheld the quantum of taxable turnover determined in the appeal, considering the assessee's past record, leading to the filing of the present revision.

3. The assessee argued that the omission to issue cash memos should not warrant account rejection, citing the nature of the business as a petty dealer in Kirana goods. However, the court disagreed, emphasizing the statutory requirement to issue cash memos under Section 8-A (4) for sales over &8377; 5/-, which the assessee failed to comply with, justifying the rejection of accounts.

4. Furthermore, the court highlighted a prior judgment emphasizing the importance of issuing cash memos for sales tax compliance. The court also referenced a similar case to support the decision to confirm the rejection of accounts due to non-compliance with the statutory obligation to issue cash memos.

5. The assessee contended that no enhancement in disclosed turnover was necessary, pointing to the acceptance of turnover in the previous year despite rejected accounts. However, the court rejected this argument, noting that the disclosed turnover was based on an estimate, and since the account books were not accepted, the turnover estimation could not be upheld.

6. Ultimately, the court dismissed the revision, upholding the rejection of accounts and confirming the quantum of taxable turnover determined by the appellate authority. The court also awarded costs to the Commissioner amounting to &8377; 200.