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TMI Blog1961 (3) TMI 83X X X X Extracts X X X X X X X X Extracts X X X X ..... he Act for the quarters ending 30th June, 1954, to 31st December, 1954. He submitted his returns and produced his account books in support of the figures returned by him. On 22nd August, 1954, one of the inspecting officers of the Sales Tax Department found one Kota Narayana of Ichhapur at the bus stand of Berhampur with some goods ready to go by bus to lchhapur. Kota Narayana gave a statement in writing in Telugu to the inspecting officer mentioning therein that the goods were purchased by him. One of the items of purchase was a bag of Bengal gram kept in two bags which Kota Narayana admitted to have purchased from the dealer-assessee Jami Biswanath Prusthy on the previous day, that is, on 21st August, 1954. He also admitted that the assessee did not give him any cash memo. The same inspecting officer then contacted the dealer-assessee on the very next day and found that the sale of a bag of Bengal gram to Kota Narayana on 21 August, 1954, had not been entered in the sale register. One of the partners of the assessee who was present then gave out that no such sale was effected to Kota Narayana. When the assessments for the said three quarters came up before the assessing officer, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atement he said that he had purchased them for private use. Accordingly, the Assistant Collector preferred the earlier statement made by this witness before the inspecting officer. Thus, he rejected the case of the assessee and confirmed the order of the assessing officer. The assessee thereafter filed a revision before the Collector of Sales Tax which came to be decided according to the new provisions by the Tribunal under section 23(3) of the Act. The Tribunal accepted the concurrent findings of the assessing officer and the first appellate authority that the case of suppression of sale of a bag of Bengal gram at Rs. 47 was established. Consequently, the Tribunal held that the assessing officer was justified in rejecting the books of account, and the returned turnovers. In view of the fact that the accounts were maintained on annual basis and the three quarters under reference were within one financial year, it held that the estimate was neither arbitrary, nor capricious since the assessing officer took account of the volume of business of the assessee. The questions referred to this Court are pure questions of law. 3.. In connection with questions Nos. (1) and (2), it was argu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o have been set at rest by the decision of the Supreme Court in the case of Raghubar Mandal Harihar Mandal v. State of Bihar(3). The Supreme Court in that case held that when the returns and the books of account are rejected, the assessing officer must make an estimate and to that extent he must make a guess, but the estimate must be related to some evidence or material and it must be something more than mere suspicion. He must make what he honestly believes to be a fair estimate (1) A.I.R. 1960 Orissa 142. (3) [1957] 8 S.T.C. 770. (2) [1958] 9 S.T.C. 648. of the proper figure of assessment and for this purpose he must take into consideration such materials as the assessing officer has before him and all other matters which the assessing officer thinks will assist him in arriving at a fair and proper estimate. That was a case under the Bihar Sales Tax Act and there was no material on record to support the estimate made by the assessing authorities. Their Lordships of the Supreme Court accepted that there was discrepancy between the return filed and the accounts filed in support of it. They found that the assessing authorities having rejected the returns and the books of account, ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e to be rejected and not for the whole year. I am afraid, I cannot accept this argument. Doubtless, quarterly returns are to be submitted under the law. The assessee in this case submitted his quarterly returns but maintained the accounts for the financial year. Sub-section (1) of section 11 enjoins upon the dealer to file returns for the quarter and under sub-section (1) of section 12 if the Commissioner is satisfied without requiring the presence of the registered dealer or the production by him of any evidence, that the returns furnished in respect of any period are correct and complete, he shall assess the amount of tax due from the dealer on the basis of such returns. Under clause (a) of sub-section (2) if the Commissioner is not satisfied without requiring the presence of a registered dealer who furnished the return or production of evidence that the returns furnished in respect of any period are correct and complete, he shall serve on such dealer a notice in the prescribed manner requiring him on a date and at a place to be specified therein, either to attend in person or to produce or to cause to be produced there any evidence on which such dealer may rely in support of suc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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