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TMI Blog1982 (2) TMI 286X X X X Extracts X X X X X X X X Extracts X X X X ..... ompleted on 25th April, 1977, when a cash memo was issued. There was another survey of the business premises of the dealer on 7th August, 1978. As against the declared number of workmen by the dealer, namely, six, eight persons were found working. On this account, the inference that was drawn by the authorities was that the dealer had not been fully disclosing the extent of manufacture made by him and consequently the sales. The dealer's explanation in regard to the entry of Rs. 400 was also not accepted by the assessing authority which came to the conclusion that in fact, the dealer had made sale of steel box on the date mentioned in the diary without disclosing it in the books. This, according to the assessing authority, clearly showed a case of concealment of sales by the dealer. The view in this regard was upheld up to the second appellate stage. Apart from subjecting the taxable turnover determined by estimate (to tax), the assessing authority initiated proceedings for the levy of penalty upon the dealer for concealment of the particulars of his turnover. Without much discussion, the assessing authority imposed, for the year in question, penalty to the extent of Rs. 2,80 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssioner of Income-tax v. Anwar Ali [1970] 76 ITR 696 (SC), the Supreme Court dealt with the matter relating to imposition of penalty under the Income-tax Act, 1922. Section 28(1)(c) of that Act was akin to the provision contained in section 15-A(1)(c) of the U.P. Sales Tax Act. After noticing the divergent opinions expressed by various High Courts the Supreme Court concluded that the provision aforesaid was penal in the sense that it was meant to provide a deterrent against the recurrence of default on the part of the assessees. As such the burden of proving the fact that there was concealment of the particulars of income by an assessee was on the department. It had to be established on material apart from the explanation offered by the assessee which may have been disbelieved, in regard to a particular item of income. It observed thus: "It appears to have been taken as settled by now in the sales tax law that an order imposing penalty is the result of quasi-criminal proceedings: Hindustan Steel Ltd. v. State of Orissa [1970] 25 STC 211 (SC). In England also it has never been doubted that such proceedings are penal in character...... ......As has been rightly observed by Chagla ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had concealed particulars of his turnover. This is the view which was taken by this Court in the case of Satya Confectionary Works v. Commissioner of Sales Tax printed infra; 1980 UPTC 356. The learned standing counsel has vehemently urged that, in the present case, the authorities had applied their minds independently to the question of concealment while dealing with the penalty matter and had not based their conclusion merely on the findings recorded at the time of the assessment proceedings. As such, the requirement of independent proof of the fact of concealment was fulfilled. It is difficult to accept this submission in the facts of the present case. The appeals against the order of assessment as well as the one imposing penalty were dealt with together by the appellate authority. Having upheld the rejection of the explanation of the dealer in regard to the sum of Rs. 400 found entered in the diary at the time of survey in April, 1977, the appellate authority proceeded to take the view that the dealer had concealed the particulars of his turnover. The finding in this regard was not based upon any material other than the one which was available for consideration during the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urvey certain loose papers were found which proved that the assessee was making unaccounted sale. The rejection of account books being based on material found at the time of survey established that the account books were not maintained properly. The order cannot be said to suffer from any error. As regards the determination of the turnover at Rs. 8,00,000, the Sales Tax Officer found that the disclosed purchase of raw material for the assessment year in dispute was Rs. 6,37,021.97 and therefore the total sale ought to be estimated at Rs. 8,00,000. The appellate authority reduced the turnover. The Judge (Revisions) did not agree with it. He instead of relying on inferences, relied on material and as such the order cannot be said to be vitiated. The rejection of account books and the fixation of turnover therefore did not call for any interference and the revision of the assessee directly against this order fails. Coming to the question of imposition of penalty it has been done because the assessee concealed the turnover and deliberately furnished inaccurate particulars of turnover. The penalty proceedings under section 15-A are penal in nature. The burden to establish the ingredie ..... X X X X Extracts X X X X X X X X Extracts X X X X
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