9911796707
TMI Blog2001 (4) TMI 896X X X X Extracts X X X X X X X X Extracts X X X X ..... d the deletion of penalty of 50 per cent of tax due on actual suppression fixed by the Appellate Assistant Commissioner. The facts relating to the suppressed turnover of Rs. 3,75,180 found during inspection on August 5, 1975 and assessed to tax and penalty, are as follows: The Enforcement Wing Officers, at the time of inspection on August 5, 1975, recovered one hand book, one pocket note book and 11 slips. The verification of the records secured during inspection revealed sales of Bengal gram, fried gram and pattani. No sale bills were produced for the disposal of the goods found in the records secured during inspection. Suppression was arrived at Rs. 3,75,180, in the absence of any correlation in the regular accounts maintained by the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per the entries found in the slips as well as in the books, cannot be said to have been wholly made from agriculturists or from outside the State. It is further significant to note that the accounts also disclose the exempted category and the taxable items in the ratio of 9: 1. However, in view of the fact that the assessee having not furnished details of the dealers from whom he has effected the purchases, we can adopt the ratio of 50: 50 as between the first and second sales, taking into consideration of all the above facts. We consider that a portion of the purchases covered by the entries can be related to first sales, wherein the goods have not suffered single point tax. In the absence of any reasonable basis for apportionment between ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hiammal [1984] 55 STC 210 (Mad.), in this case, the department has not proved that the transactions found in the anamath records related solely with reference to purchases from outside the State or from agriculturists. Therefore, the adoption of 50: 50 ratio to fix the suppression in this case, is reasonable. The deletion of penalty also is proper, in as much as the suppression has not been categorically established. 7.. We have considered the contentions carefully and perused the records. It is an admitted fact that the suppression to the extent of Rs. 3,75,180 was detected with reference to anamath records secured during inspection on August 5, 1975. These transactions have not been reflected in the books of accounts. This view was appr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion and such records have not been shown as reflected in the books of accounts, the suppression arrived at, cannot be allocated in the ratio of 50: 50, by following the decision reported in [1984] 55 STC 210 (Mad.) (State of Tamil Nadu v. Gomathiammal), which was based entirely on the peculiar circumstances of the case. 10.. It is also relevant to refer to the decision of the Madras High Court in the case of State of Tamil Nadu v. C. Pandian reported in [1997] 105 STC 449. In that case, the turnover found in the incriminating documents recovered during inspection on July 20, 1982, was not shown in the books of accounts of the assessee. Though the Appellate Assistant Commissioner approved that such suppressed transactions related to fir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se there was no proof that the assessee has effected any inter-State purchases or voucher purchases from agriculturists or any other person, it can be straightaway concluded that the impugned turnovers represent only second sales. Therefore, it is clear to us that the Tribunal has erred in law in having modified, the assessment made by the assessing authority, which was confirmed by the first appellate authority." 11.. The present case before us is similar to the case before the Madras High Court reported in [1997] 105 STC 449 (State of Tamil Nadu v. C. Pandian). Further, in this connection, it is relevant to refer to the decision of the Supreme Court in the case of State of Tamil Nadu v. Govindan Co. reported in [1994] 93 STC 185, wher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ability of the assessee to establish the case of sale at Bombay. 14.. But, in the present case before us, the records secured during inspection clearly established suppression and that the assessee could not correlate the transactions with the regular books of accounts maintained. In such circumstances, the wilful suppression warrants penalty and the reliance placed on [1978] 42 STC 121 (Mad.)[FB] (Kathiresan Yarn Stores v. State of Tamil Nadu), so as to grant relief by the Appellate Tribunal, is totally a perverse finding. Thus, we find that there is absolutely no case to delete the penalty, which was fixed at 50 per cent of tax on the actual suppression by the Appellate Assistant Commissioner, taking note of all the circumstances of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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