9911796707
TMI Blog1993 (7) TMI 322X X X X Extracts X X X X X X X X Extracts X X X X ..... and the taxable turnover as "nil". The turnover disclosed as per the accounts and the returns was found not acceptable by the assessing authority. Various defects were pointed out in the pre-assessment notice served on the assessee dated December 23, 1988. Amongst others, the assessing authority stated that the business place was inspected by the Sales Tax Inspector on January 30, 1988 and the inspection revealed variation in the stock in different items. There was also another inspection of the business place of the assessee by the Intelligence Squad on March 11, 1988. The physical verification of few items was ascertained and recorded in the S.I.R. prepared. The stock recorded, when verified with the accounts, disclosed discrepancies i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 and March 11, 1988 and held that there were variations in stock on both the occasions. It was further noticed that when proceedings were taken with regard to the variations and other discrepancies that appeared on the inspection day (March 11, 1988), the assessee compounded the offence departmentally, by paying Rs. 2,750 as compounding fee. The Appellate Tribunal observed that the difference in stock was originally admitted by the assessee himself and compounded and so, he is estopped from denying the admitted facts of difference of stock. In these circumstances, it was held that the assessee is not maintaining a true and correct account, that there is a pattern in the suppression, the Appellate Assistant Commissioner was not justified in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the time of hearing before her and holding that with regard to certain items, there was no discrepancy as stated by the assessing authority. It was argued that no relevant material on record in proper form was placed before the Appellate Assistant Commissioner assailing the veracity of the two inspection reports and the facts disclosed in those proceedings and, in the light of these facts, the Appellate Assistant Commissioner was in error in placing reliance on the casual statements filed at the time of hearing which were not properly brought on record. Learned Government Pleader argued that the Appellate Tribunal was justified in setting aside the order of the Appellate Assistant Commissioner and in restoring the order passed by the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the preassessment notice that the variations in the stock pointed out are not real or correct. It was so repeated in the appeal memorandum filed before the Appellate Assistant Commissioner. There was no specific plea either in the reply to the pre-assessment notice or in the appeal memorandum stating that there were no inspections or that the statements contained in the inspection reports are incorrect or untrue. Both the inspection reports are admittedly signed by the assessee. The assessee did not put forward a plea that there are mistakes in the said statements. The assessee had no plea either in the reply to the pre-assessment notice or in the appeal memorandum filed before the Appellate Assistant Commissioner that the compoundi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be correct and true. It is certainly open to the assessee to assail the particulars contained therein. It is also open to the assessee to demonstrate by adducing proper evidence before the appellate authority that the statements contained in the two inspection reports are not correct or were made under peculiar circumstances, which would warrant their rejection. No such attempt was made by the assessee in this case. We perused the two statements filed by the assessee before the Appellate Assistant Commissioner. They are stated to be analysis. It is not possible to say from the above two statements that the details contained in the two inspection reports regarding the discrepancies are in any way wrong or were noted under a mistake. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r casting doubts will not be enough. We are unable to accept the plea of the Revenue that the materials or statements in the compounding proceedings will in any way be "conclusive" in the assessment proceedings. We make it clear that the compounding proceedings or statements or admissions therein will only be relevant, but not conclusive in assessment proceedings. We express our respectful dissent with the decision of the Madras High Court in R. Sundaresa Iyer Sons v. Board of Revenue [1971] 28 STC 430, wherein the learned Judges have held that the facts found in compounding proceedings may not be material in assessment proceedings. The facts found in the compounding proceedings may constitute a relevant material in the assessment proceed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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