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TMI Blog1975 (8) TMI 114X X X X Extracts X X X X X X X X Extracts X X X X ..... essment year 1959-60, they were assessed on a taxable turnover of Rs. 3,86,284.27 as against Rs. 3,20,554.36 reported by them. On a surprise inspection of their place of business on 4th August, 1964, certain records were seized and on verification of these records, the assessing officer considered that the assessees had suppressed taxable turnover to the extent of Rs. 1,20,346.92. Proceedings accordingly were initiated under section 16(1). After giving a reasonable opportunity to the assessees by a revised assessment order dated 18th December, 1964, the suppressed turnover of Rs. 1,20,346.92 was brought to assessment. In this assessment order the assessing officer has stated that separate orders will be issued with regard to the levy of pen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der under section 16(1). He further contended that the decision in State of Madras v. Ramulu Naidu(1) was rendered with reference to the provision in section 12(3), which is not similar to the power of the assessing officer under section 16(2) and that, therefore, that decision is not applicable. In the decision reported in State of Madras v. Ramulu Naidu[1965] 16 S.T.C. 865., this court, on a consideration of the provisions of section 12, held that the penalty contemplated under section 12(3) depends on and follows a finding as to the incompleteness and incorrectness of the return submitted, and forms part of the proceedings resulting in best judgment assessment. No independent enquiry was contemplated by that provision for the purpose of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... levy of penalty under section 12(3) is discretionary both with respect to levy and also the quantum of penalty. If that is so, certainly the dealer should be given notice to show cause as to why an order of penalty should not be made under section 12(3). Might be, if the assessing officer is satisfied with the explanation, either he may omit to levy the penalty or impose such reasonable penalty, as he considers just and necessary in the circumstances of the case. Having regard to these facts, we are of the view that the provision of section 12(3) definitely contemplates a notice being issued to the dealer before an order of penalty is made under that provision. But that is not to say that the notice should be either separate or at any part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lty, being discretionary, before he levies the penalty he will have to reject the explanation of the dealer, in which case, undoubtedly, he will have the power to levy the penalty on any figure he chooses. Even in cases where he accepts the explanation, still he may choose to levy the penalty, but the quantum of penalty will have to depend on the facts and the circumstances of each case, of course, subject to the maximum prescribed under that section. But, on the other hand, in cases falling under section 16(2) unless there is a definite finding as to the wilful non-disclosure of taxable turnover, the assessing officer will have no jurisdiction to impose the penalty. Except for this difference, we do not find any other difference between se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 31 did not make any specific reference because every one of the orders made under section 12 is appealable. We are, therefore, unable to hold that separate orders were contemplated under section 16(2). In fact, it was not even the case of the Government Pleader that only separate orders could be made under section 16(2). On the other hand, he contended that it was open to the assessing officer either to make a consolidated order or separate orders under section 16(2). We are, therefore, of the opinion that the Tribunal was right in holding that no separate order of penalty could be made under section 16(2). Before we part with this case, we must express our grateful thanks to Thiru S.V. Subramaniam for the assistance rendered in the abse ..... X X X X Extracts X X X X X X X X Extracts X X X X
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