State of Tamil Nadu vs Bharani Hyderaulics

P.P.S. Janarthanaraja, J.—The tax case revision is filed by the Revenue u/s 38 of the Tamil Nadu General Sales Tax Act, 1959, against the order of the Sales Tax Appellate Tribunal, dated March 17, 2003 passed in C.T.S.A. No. 699 of 2001, raising the following question of law: Whether the Tribunal is correct in upholding the decision of Appellate Assistant Commissioner (CT), by accepting the assessee''s subsequent accounting of sale suppression by filing revised return cannot be termed as sales suppression/omission, which was unearthed by the enforcement wing at the time of inspection will not amount to nullify the spirit of inspection and consequent best judgment assessment as contemplated under the Tamil Nadu General Sales Tax Act, 1959?

The respondent/assessee is a small-scale manufacturer of hydraulic press for the industrial applications. At the time of inspection by the enforcement wing authorities on August 7, 1998, they found some discrepancies/suppression in the books of accounts and therefore, made assessment on the enhanced turnover of Rs. 16,06,293 and also levied penalty. Aggrieved against that, the respondent-assessee went on appeal to the Appellate Assistant Commissioner, who allowed the appeal holding the issue in favour of the assessee. Aggrieved by that order, the Revenue has filed the appeal before the Tamil Nadu Sales Tax Appellate Tribunal. The Tribunal dismissed the appeal filed by the Revenue. Hence, the present tax case revision by the Revenue before this court raising the question of law referred above.

The learned counsel appearing for the Revenue submitted that the Tribunal failed to note that during the inspection of place of business on September 7, 1998, some incriminating documents were found and suppressions were noticed. Therefore, the order passed by the appellate authorities are bad in law and the same has to be set aside.

The learned counsel appearing for the respondent/assessee submitted that the Tribunal is correct in deleting the addition made, which is based on valid materials and hence, the order passed by the Tribunal is in accordance with law and the same has to be confirmed.

We have heard Mr. Manoharan Sundaram, learned Government Advocate (Taxes) for the appellant-Revenue and Mr. V. Anand, learned counsel for the respondent-assessee. It is seen from the records that both the appellate authorities had given a concurrent finding that there is no suppression/omission in the books of accounts maintained by the assessee. In para 6 of the impugned order of the Tribunal, there is a categorical finding that the assessee disclosed the taxable turnover of Rs. 2,48,784 for the month of September 1997 and Rs. 7,62,565 for the month of October 1997 in the assessment for the year 1997-98 filed on November 20, 1997 and also found that since the inspection of the enforcement wing was only on August 7, 1998, it cannot be held that this turnover was found unreported at the time of inspection. Hence, the Tribunal had given a concurrent finding that the alleged turnover was reported even before the inspection was held by the authorities on August 7, 1998.

Further, even with regard to the actual suppression made out of slips at Rs. 2,91,872, the Tribunal found that entries in respect of the same have been duly accounted for and the authorities have not taken that into account while concluding at the sales suppression. The first appellate authority, after perusing the connected records, found that no purchase or sales suppressions were involved in the said slips so recovered and the explanations offered by the assessee were acceptable. In view of the above categorical and concurrent finding of both the appellate authorities below, we are of the view that no question of law that arises for our consideration, warranting interference by this court. Under these circumstances, the tax case revision is devoid of merits and the same is dismissed accordingly. No costs.