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TMI Blog1984 (6) TMI 211X X X X Extracts X X X X X X X X Extracts X X X X ..... the ground that he has been crushing gingelly and groundnut in country chekkus and therefore he is entitled to exemption under G.O. Press No. 1963, Revenue, dated 21st April, 1960. The assessing authority held that since the exemption under the notification is subject to the terms and conditions set out therein and the petitioner has not complied with some of the relevant terms and conditions, he is not entitled to the exemption under the said notification. Similar claim for exemption was also made in respect of the assessment years 1970-71 and 1972-73, and the claim was rejected on the same ground. After rejecting the claim for exemption the assessing authority proceeded to make the assessments on the basis of certain records recovered fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce and Oil Mills of N.C.R. Masilamani Chettiar Bros., Kaveripattinam, and thereby he had interest in rotary or expeller, that he has not taken out any permits with reference to oil chekkus as contemplated in the exemption notification dated 1st November, 1969, and he has not conformed to the conditions set out therein. On the basis of these findings, the appellate authority held that the best judgment assessment was justified on facts and that the assessee is not entitled to claim exemption under the notification stated above. The Appellate Assistant Commissioner also sustained the order levying penalty. However, when the matter reached the Tribunal by way of further appeal by the assessee, the Tribunal had chosen to give some relief to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urnover would give relief in relation to the penalty proportionately. But the Tribunal in this case has chosen to cancel the penalties levied in respect of all the three years without giving sufficient reasons. The reason given by the Tribunal for setting aside the order of penalty is that there is no scope or justification for the levy of penalty in all these cases. As the assessee did not maintain accounts, the question of sales suppression does not arise and the assessee cannot be said to have avoided tax. We are not in a position to agree with the Tribunal that there is no scope or justification for the levy of penalty in this case. The mere fact that the assessee had not maintained accounts at all cannot be taken advantage of by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Tribunal itself in the earlier portion of its order says that but for the surprise inspection, the turnover covered by these records would not have come to light. We do not see how the same Tribunal while dealing with penalty says that there is no question of any suppression as the assessee has not maintained the accounts of his business. On the finding of the Tribunal that but for the surprise inspection the turnover would not have been disclosed, the legal inference is that there was in fact suppression by the assessee and it is only with a view to suppress the turnover he has failed to maintain the books of account for his business. On the facts of this case, the Tribunal is not right in holding that there has been no sales suppression ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not attracted and that once the return submitted by the assessee is not accepted and best judgment assessment is made, after making certain additions to the turnover returned, then section 12(3) stands attracted. Here, we have a fortiori case where the assessee maintains no books of account, nor submits a return to the assessing authority as enjoined by the Act and the Rules, and the extent of the transactions carried on by him has to be estimated from the materials recovered from the assessee's place of business as a result of surprise inspection. These materials clearly indicate that the assessee intended to suppress the transactions found in the said records recovered from the assessee's place of business. On the facts, the Tribunal also ..... X X X X Extracts X X X X X X X X Extracts X X X X
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