Undisclosed sales turnover and unrebutted bank records justify statutory penalty for concealment under sales tax law.

Penalty under section 16(2) of the Tamil Nadu General Sales Tax Act was held sustainable where reassessment findings, based on bank records and the assessee's failure to produce relevant records, established undisclosed sales turnover. The court treated the non-disclosure as concealment rather than a mere dispute, because the escaped turnover had not been returned in the assessee's returns and remained unrebutted. The earlier decision in Kathiresan Yarn Stores was found inapplicable on different facts. The penalty cancellation was reversed and the levy was left intact.

---

---

Issues: Whether penalty under section 16(2) of the Tamil Nadu General Sales Tax Act was sustainable where the assessee had not disclosed sales turnover and the reassessment had been upheld on the basis of bank records and the assessee's failure to produce relevant records.

Analysis: The Tribunal's finding on reassessment established that the disputed sales had in fact been made and that the assessee had not produced the relevant records to disprove the turnover reflected in the bank records. Once the turnover was found to have escaped assessment because it was not returned in the assessee's returns, the non-disclosure was not a matter of mere doubt but supported a finding of concealment. The earlier decision in Kathiresan Yarn Stores was held inapplicable because the factual foundation there was different from the present case.

Conclusion: Penalty under section 16(2) was attracted and the Tribunal was wrong in setting it aside; the issue is decided in favour of the Revenue.

Final Conclusion: The revision succeeded and the order cancelling the penalty was reversed, leaving the penalty levy intact.

Ratio Decidendi: Where reassessment findings establish undisclosed sales and the assessee fails to rebut the escaped turnover with relevant records, the concealment is sufficient to attract statutory penalty under section 16(2).

---