True and complete accounts default limited penalty to the accounting-default provision, not tax evasion, under section 45A(1).

Concurrent findings that the dealer failed to maintain true and complete accounts were sustained because the stock variations and notebook entries were supported by material on record and showed no perversity or legal infirmity. The penalty could not be treated as one for tax evasion, since the petroleum products were sold under a single-point levy and liability attached to the first sale by the oil company, not the dealer. The matter therefore fell under the latter part of section 45A(1), limiting penalty to the statutory ceiling for accounting default. The penalty orders were set aside and remitted for fresh determination within that ceiling.

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Issues: (i) Whether the finding that the dealer had failed to maintain true and complete accounts and that the stock discrepancies and notebook entries related to the business was sustainable. (ii) Whether the penalty was exigible under the first part of section 45A(1) or only under the latter part with a maximum of Rs. 5,000.

Issue (i): Whether the finding that the dealer had failed to maintain true and complete accounts and that the stock discrepancies and notebook entries related to the business was sustainable.

Analysis: The factual findings recorded by the authorities on stock variation and the business connection of the pocket notebook were supported by material on record. No perversity or legal infirmity was shown in those concurrent findings, and they justified the conclusion that the accounts were not true and complete.

Conclusion: The finding of default in maintaining true and complete accounts was sustained, against the assessee.

Issue (ii): Whether the penalty was exigible under the first part of section 45A(1) or only under the latter part with a maximum of Rs. 5,000.

Analysis: The petroleum products sold by the dealer during the relevant year were subject to single-point levy, and the tax liability under the schedule entry attached to the first sale by an oil company. As the dealer was not an oil company, no liability to evade tax on those sales could arise against him. The case therefore fell within the latter part of section 45A(1), which governed failure to maintain true and complete accounts and capped the penalty at Rs. 5,000.

Conclusion: The penalty could not be sustained on the basis of tax evasion and was confined to the latter part of section 45A(1) with a maximum of Rs. 5,000, in favour of the assessee.

Final Conclusion: The penalty orders were set aside and the matter was sent back for fresh determination of penalty within the statutory ceiling applicable to the accounting default.

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