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TMI Blog1991 (8) TMI 297X X X X Extracts X X X X X X X X Extracts X X X X ..... . Scrutiny of the records so recovered disclosed certain entries in the pocket note book which had not been included in the turnover to the extent of Rs. 58,110. The assessee admitted that the amounts reflected in the note book to the extent of Rs. 58,110 had been received by the assessee but its case was that the same were received from the buyers as premium and were not a part of the sale price. The note book had reflected different premiums collected per barrel for the period April, 1979 to 22nd of November, 1979. The assessing authority, after taking into account the entries in the pocket note book and the empty covers estimated that the amount collected by way of premium by the assessee would have worked out to Rs. 1,47,430. The assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ords were recovered and the officers had verified those records and found that the amount noticed in the covers were also reflected in the pocket note book marked as "J". On the basis of the entries in the pocket note book "anamath entries" a suppression of only Rs. 58,110 was calculated. It was found by the Appellate Assistant Commissioner that neither the Enforcement Wing Officer nor the assessing authority had gathered any material to show that the assessee had collected premium for sales, other than those which were found entered in the pocket note book. The Appellate Assistant Commissioner therefore concluded that it was not possible to presume that in all cases goods had been sold only at one rate to all the customers after receiving ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the assessee based on the entries in the pocket note book stood amply established and that there was no cause made out for interference with that addition. However, the Tribunal was of the view that penalty of Rs. 5,000 under section 12(3) of the Act was not called for, and consequently it deleted the penalty. 6.. On behalf of the Revenue it has been submitted by the learned Government Advocate that since the suppression was noticed and the Tribunal had upheld the finding relating to suppression based on the entries found in the pocket note book to the extent of Rs. 58,110, the Tribunal was not justified in deleting the penalty levied under section 12(3) of the Act. 7.. Mrs. Chitra Venkataraman appearing for the assessee-respondent on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e amounts mentioned in clause (a) or (b) of the section. Recourse to section 12(2) is made, inter alia, when no return is submitted by the dealer under sub-section (1) within the prescribed period or where the return submitted by him appears to the assessing authority to be incomplete or incorrect, and the assessing authority, after making an enquiry proceeds to assess the assessee to the best of its judgment, after giving a reasonable opportunity of proving the correctness or completeness of accounts/return submitted by the assessee to the concerned assessing officer. It would thus be seen that under sub-section (3) of section 12 a discretion has been conferred on the assessing authority in the matter of levy of penalty. Levy of penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s made in the pocket note book. The case of the assessee was that the amount of premiums collected by it were for priority supplies of goods and would not form part and parcel of the sale amount. The plea of the assessee was not accepted by the statutory authorities including the Tribunal. But the explanation of the assessee cannot be ignored while considering the exercise of discretion by the Tribunal for deleting the penalty levied under section 12(3) of the Act. The explanation which did not find favour could have been based on a mistaken notion that premium is not required to be included in the sale price. The Tribunal, after a detailed discussion with regard to the levy of penalty observed: "In the circumstances of the case we feel t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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