TaxTMI Login
Just a moment...
Press 'Enter' to add multiple search terms. Rules for Better Search
of 
of 
No Folders have been created
Are you sure you want to delete "My most important" ?
NOTE:
of of 
All Case Laws
of of All Case Laws
Note
Bookmark
Share
Don't have an account? Register Here
of <h1>Court rules in favor of pulses dealer in escaped turnover assessment case under Section 14(4)</h1> The court ruled in favor of the petitioner, a dealer in pulses, in a case regarding the assessment of escaped turnover under Section 14(4) of the Andhra ... - Issues:1. Assessment of escaped turnover under Section 14(4) of the Andhra Pradesh General Sales Tax Act.2. Validity of the notices issued by the assessing authority.3. Competency of the assessing authority to initiate proceedings under Section 14(4).4. Legality of the formula adopted by the assessing authority for assessing the escaped turnover.5. Imposition of penalty based on the assessment of escaped turnover.Analysis:1. The judgment deals with the assessment of escaped turnover under Section 14(4) of the Andhra Pradesh General Sales Tax Act. The petitioner, a dealer in pulses, was initially taxed based on his monthly return that included certain transactions. Subsequently, the assessing authority issued multiple notices alleging different amounts of escaped turnover. The court examined whether the turnover had actually escaped assessment to tax, considering that the transactions in question were included in the return and taxed accordingly. It was held that Section 14(4) was not applicable as the turnover had not escaped assessment after being duly included in the return.2. The validity of the notices issued by the assessing authority was questioned in the judgment. The authority had issued multiple revised notices altering the alleged escaped turnover amount without sufficient justification. The court observed that the assessing authority had continuously shifted the grounds for assessing the escaped turnover, initially using an ad hoc increase and later adopting a new formula without proper basis. The lack of consistency and reasoning behind the notices raised doubts about their validity.3. The competency of the assessing authority to initiate proceedings under Section 14(4) was a crucial issue in the judgment. The court found that the assessing authority lacked competence to start proceedings under Section 14(4) as the turnover in question had not genuinely escaped assessment. Moreover, the authority's changing justifications and arbitrary assumptions in assessing the escaped turnover further undermined its competency to conduct fair and lawful assessments.4. The legality of the formula adopted by the assessing authority for assessing the escaped turnover was extensively analyzed in the judgment. The authority had used a questionable formula based on arbitrary assumptions, such as multiplying the amount of two specific transactions by 82 days to determine the alleged suppressed turnover. The court deemed this approach arbitrary and unsupported by any concrete evidence or material, highlighting the lack of a valid basis for the assessment methodology used by the authority.5. Lastly, the imposition of a penalty based on the assessment of the escaped turnover was addressed in the judgment. Given the court's findings that the original assessment and the formula used were arbitrary and unlawful, the penalty imposed on such a flawed assessment was deemed invalid. The court concluded that when the original assessment is flawed, the penalty cannot be upheld, leading to the allowance of the petition and the quashing of the assessing authority's order dated 10th May, 1961.
TaxTMI 
TaxTMI 
