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2022 (6) TMI 972 - HC - VAT and Sales TaxReduction of assessment framed under Section 12 (4) of the Orissa Sales Tax Act, 1947 - purchase and sales suppression - business was only four months old on the date of inspection - HELD THAT - The Tribunal appears to have overlooked the fact that the Assessee had only conducted four months of business in the year in question and that was one factor that weighed with the ACST in reducing the enhancement of the taxable turnover to thrice the actual amount of suppression. In the considered view of the Court, since this was a new venture and it is possible that the Assessee was not fully aware of all the legal requirements, the view taken by the ACST enhancing the taxable turnover to three times the actual suppression did not call for interference. It could not be said to be arbitrary or unreasonable. This Court restores the order of the ACST to file and sets aside the impugned order of the Tribunal. The question framed is accordingly answered in favour of the Assessee and against the Department - Revision petition disposed off.
Issues:
1. Justification of the Tribunal in setting aside the order of the ACST in a cross appeal by the Department and restoring the order of the Assessing Officer. Analysis: The case involves a revision petition arising from an order passed by the Orissa Sales Tax Tribunal, which stemmed from an order by the Assistant Commissioner of Sales Tax (ACST) reducing an assessment under the Orissa Sales Tax Act for the year 2004-05. The petitioner, a dealer in marbles and tiles, was registered under the OST Act and reported a gross turnover for the year. An investigation revealed discrepancies in sales and purchase, leading to an assessment by the STO based on best judgment. The STO estimated a significant suppression of sales, which was later contested in an appeal by the Assessee. The ACST, in its order, limited the enhancement of taxable turnover to thrice the actual suppression, considering the business's short duration at the time of inspection. The Assessee appealed seeking further relief, while the Department filed a cross appeal against the ACST's order. The Tribunal, in its impugned order, set aside the ACST's decision and restored the STO's order, disagreeing with the reduction of the enhancement. Upon hearing the parties, the Court noted that the Assessee's limited business duration during the year in question was a crucial factor considered by the ACST in reducing the enhancement. The Court held that given the circumstances of a new venture and potential lack of awareness of legal requirements, the ACST's decision was not arbitrary or unreasonable. Consequently, the Court upheld the ACST's order, setting aside the Tribunal's decision and ruling in favor of the Assessee against the Department. The revision petition was disposed of accordingly, with an urgent certified copy of the order to be issued.
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