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TMI Blog1965 (12) TMI 128X X X X Extracts X X X X X X X X Extracts X X X X ..... the turnover of imported cloth of Rs. 2,44,000 and odd. The Sales Tax Officer found that it had concealed the importing of thirteen bales of cloth and rejected the return and the accounts. He then fixed the turnover at Rs. 4,00,000 according to the best of his judgment and assessed it accordingly. It filed an appeal, which was partly allowed by the Judge (Appeals). The Judge (Appeals) held that the turnover of the suppressed bales was at the most Rs. 15,000, accepted the returned turnover as the correct turnover of the disclosed sale and adding the two amounts determined the amount of the taxable turnover at Rs. 2,60,000. The Sales Tax Commissioner and the assessee both applied to the judge (Revisions) to revise the order of the judge (Appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the Sales Tax Commissioner's applications were allowed. In both the Judge (Revisions) restored the orders of the Sales Tax Officer adopting the reasons as in Reference No. 271. We shall deal with Reference No. 271 of 1963 and whatever we say applies with equal force to the associated references. The question framed by the Judge (Revisions) is not proper, it is not a question of law or exclusively of law. What is correct or legal depends upon the law applicable to the facts but what is just and proper depends upon the judgment or discretion of the authority and not upon law, and certainly not exclusively upon law. Everything that is legal is not necessarily just and proper. Anything that involves discretion or judgment is a question of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e different. In estimating the turnover of an assessee the Sales Tax Officer must take into consideration the business carried on by him; he cannot estimate it at any figure that he likes without considering any relevant circumstance concerning his business. He must take some circumstance into consideration before estimating his turnover; he cannot possibly estimate it without considering a single circumstance. In Dhakeswari Cotton Mills Ltd. v. Commissioner of Income-tax, West Bengal[1954] 26 I.T.R. 775; [1955] 1 S.C.R. 941., Mahajan. C.J., observed at page 949: "The Income-tax Officer is not fettered by technical rules of evidence and pleadings, and......he is entitled to act on material which may not be accepted as evidence in a court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s estimate are as follows: The returned turnover is Rs. 2,44,000 and odd and the actual turnover must be more. The assessee did not maintain its accounts properly, did not file two quarterly returns of its turnover and did not submit quarterly statements of imports in the prescribed form. It made an attempt to conceal the magnitude of its business. It concealed importation of thirteen bales of cloth, some of which were imported by it in the name of a fictitious person. The non-filing of quarterly returns and the non-submission of statements of import were offences under the Sales Tax Act and the Sales Tax Officer had power to impose a penalty upon it for concealment of sales and evasion of sales tax. The assessee would not have undertaken t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n 7(3) is, therefore, in its very nature an estimate and not a calculation; it cannot be explained arithmetically. The circumstances mentioned by the Sales Tax Officer are circumstances from which he could infer that the assessee's turnover was Rs. 4,00,000. All that has to be seen is whether his determination is out of all proportion or not, whether it is an entirely wild guess or whether it is of a shocking amount. We cannot say that the determination in the instant case can be described as a wild guess, having no relation to the circumstances or is a shocking determination. It is supportable by the circumstances stated by the Sales Tax Officer. The question, therefore, is answered in the affirmative. We direct that copies of this judgm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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