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TMI Blog2008 (11) TMI 641X X X X Extracts X X X X X X X X Extracts X X X X ..... to Bangalore and Pondicherry as well as proportionate customs duty and other import charges and other expenses had been omitted to be included? Whether the Tribunal has erred in not following the settled law that mere gross profit or loss cannot be the sole reason for rejecting the accounts when there was no purchase or sale omission? Whether the consequent penalty levied as affirmed by the Tribunal is valid in law? Held that:- The authorities have held that for kerosene, which is a scarce commodity, such a huge loss could not have been recorded unless there was a sale suppression and also there was no explanation, inspite of opportunity being given, as to why the commodity was sold at such a low price compared to the purchase pric ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng authority has erred by merely affirming the order of the first appellate authority by omitting to take into account the audited balance sheet and trading and profit and loss account duly filed during the hearing of the appeal before the first appellate authority and thus formed part of the appeal records? (2) Whether the Tribunal has erroneously concluded that there was a huge loss merely based upon the rough trading account furnished for the Chennai branch alone in which value of stock transfer made to Bangalore and Pondicherry as well as proportionate customs duty and other import charges and other expenses had been omitted to be included? (3) Whether the Tribunal has erred in not following the settled law that mere gross profi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it will not automatically lead to sales or purchase omission, but there must be some reason and that the assessee did not give any reason for the extremely low price at which they had sold the kerosene, when compared to the cost of purchase. As such, in the absence of documentary evidence or any explanation, the Appellate Assistant Commissioner confirmed the assessment. Before the Tribunal, the same grounds were reiterated. In these circumstances, we are unable to accept the submission made by the learned counsel for the petitioner that audited balance-sheet and trading and profit and loss accounts were filed during the hearing of the appeal. If so, at least before the Tribunal, the assessee would have pointed out that these documents we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner relies on Appollo Saline Pharmaceuticals (P) Ltd. v. Commercial Tax Officer (FAC) reported in [2002] 125 STC 505 wherein this court has held as under (see page 508): 7. Though other sub-sections of section 12 were amended by the State Legislature subsequent to the date of the judgment in the case of Jayaraj Nadar Sons [1971] 28 STC 700 (SC), section 12(1) and 12(2) have remained in the same form. The legislative intention therefore, except during the period December 3, 1979 to May 27, 1993 and on and after April 1, 1996 must be taken to be to, permit the levy of penalty only in case where the assessment is a best judgment assessment made on an estimate and not by relying solely on the accounts furnished by the assessee in the pres ..... X X X X Extracts X X X X X X X X Extracts X X X X
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