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of <h1>Court limits turnover enhancement, quashes penalty order, and remits case for further proceedings.</h1> <h3>Produce Commercial Syndicate Versus The State of AP</h3> The Court held that the Assistant Commissioner's enhancement of the petitioner's turnover was beyond the prescribed limitation, as it constituted escaped ... - Issues:Assessment proceedings and penalty proceedings arising from orders of the Sales Tax Appellate Tribunal in T.A. Nos. 378/76 and 379/76.Analysis:The petitioner, a firm, challenged the enhancement of turnover by the Assistant Commissioner of Commercial Taxes beyond the prescribed limitation under the A.P.G.S.T. Act. The petitioner's return for the assessment year 1969-70 showed a turnover of Rs. 30,500, but the Deputy Commercial Tax Officer assessed it at Rs. 1,44,173.50. The Assistant Commissioner further enhanced it to Rs. 1,87,724.20 based on turnover not previously produced. The Sales Tax Appellate Tribunal upheld the enhancement, stating no limitation for disposal of appeals. The key issue was whether it was a case of escaped turnover, triggering the limitation under section 14(4-A) of the Act.The Court analyzed the circumstances and found that the petitioner failed to produce the book containing the correct turnover during assessment, leading to an estimate by the Deputy Commercial Tax Officer. The Court distinguished this from a mere calculation error, deeming it an obvious case of escaped turnover. As such, the six-year limitation under section 14(4-A) applied, rendering the Assistant Commissioner's order, dated 27th April 1976, beyond the prescribed period. Consequently, the Court held the lower authorities erred in disregarding the limitation issue, setting aside the addition made by the Assistant Commissioner and confirming the Deputy Commercial Tax Officer's assessment order.Regarding the penalty, since the addition was set aside, the penalty order was also quashed. The Court directed the Tribunal to proportionately reduce the penalty. As a result, T.R.C. No. 61 of 1977 was allowed, and T.R.C. No. 62 of 1977 was remitted back to the Sales Tax Appellate Tribunal for further proceedings. No costs were awarded, but an advocate's fee of Rs. 200 was specified for each party.
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