9911796707
TMI Blog1993 (1) TMI 267X X X X Extracts X X X X X X X X Extracts X X X X ..... ssed by the first appellate authority-Additional Deputy Commissioner (Appeals), dated November 17, 1989, by a common order dated February 22, 1991. For the assessment year 1987-88, the assessee reported a taxable turnover of Rs. 14,46,783.43. The books of accounts and the returns were rejected by the assessing authority and he determined the taxable turnover at Rs. 93,74,230. In determining the taxable turnover aforesaid, the assessing authority adopted the basis, of three times the running stock value. In first appeal, the Deputy Commissioner of Sales Tax, Ernakulam, reduced the addition to two times the running stock. Against the relief granted to the assessee, the Revenue filed T.A. No. 201 of 1990 before the Sales Tax Appellate Tribunal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tenance of true and correct accounts, the assessee itself came forward with a compounding application. The offence was compounded by paying a fee of Rs. 3,700. Even before the Appellate Tribunal the assessee did not plead for acceptance of the accounts. On facts, it is common ground that the rejection of accounts was justified. 3.. The only serious question that arose for consideration before the Sales Tax Appellate Tribunal and still canvassed before us is regarding the reasonableness of the estimate made. On this aspect, we should at once say that reasonableness of the estimate to be made in a best judgment assessment, is largely an exercise to be done on a case to case basis and ordinarily a decision made by the final fact-finding auth ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ous years or by reference to running stock or by making an ad hoc addition on percentage basis, which by and large should have nexus or be germane to relevant facts (the said methods are not exhaustive). On facts, the Revenue should be able to substantiate that out of the alternatives, a fair approach/method has been adopted. In this case, the Tribunal took the view that the estimate of addition should not be made with reference to running stock. It should be remembered that for estimating the turnover adopting the multiple of running stock is not the only or exclusive basis or approach. In this case, the running stock for the year amounts to Rs. 31,24,742. The assessee pleaded that he was forced to keep such a high stock of gold jewellery ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he reported taxable turnover of Rs. 14,46,783.43, will be more reasonable and will meet the ends of justice in this case. We, therefore, direct the assessing authority to modify the assessment and fix the taxable turnover of the assessee for the year in question adding 100 per cent towards probable omissions and suppressions to the taxable turnover returned. To this extent, we modify the assessment and in all other respects, the assessment will stand." 5.. The facts found by the Appellate Tribunal or proved before it amply demonstrate that the method of estimating the turnover by reference to running stock will be unreasonable and unfair. The Appellate Tribunal has applied its mind and has not acted mechanically. The various aspects highl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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